FHA down payment

[Anonymous]

I'm looking to purchase a condo for no more then 135,000.00  so by my calculations  with the 3.5% down i need about 5 grand down .I have close to that in the bank now and will have that much by the time I apply . But my question is I will be applying for nj smart start grant/ down payment assitstance and will try to make the seller pay anywhere from 3-6% concession which should cover the closing costs . I am curoius if i can use the down payment assistance as my full down payment  or does the first 3.5%   have to come out of my pocket and the assistance would just be extra ..

[7ate9]

I'm in a similar situation as you.  From what I've learned, the 3.5% downpayment does need to come from you regardless of how much downpayment assistance you get elsewhere. However if the money you're getting from the program can be applied to closing costs, that might be he way to go.  That along with the funds you're getting from the seller for closing would likely result in a pretty big surplus. Your loan officer should give you the option of using the surplus towards additional downpayment, or having it credited to you at closing.  You should definitely ask the loan officer way ahead of time because they may automatically apply any surplus to the loan to reduce your principal.

[Anonymous]

what do you mean by credited back to you .do you mean i'll get it back?

[7ate9]

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@Anonymous wrote:

what do you mean by credited back to you .do you mean i'll get it back?

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Yes, you would walk away from the closing table with a check.