Types of Down Payment Options: Tax Refunds, Gifts, Retirement Funds

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Do you dream of buying a home of your own but hesitate because you lack the funds for a down payment? You’re not alone. Many people postpone making their American dream come true because of the fear of having to come up with a down payment, but there are more options than you might initially think of when it comes to raising funds for your down payment. These are some viable down payment options you should consider.


A grant provides free money you never have to pay back, and who doesn’t like free money? You might find gift down payment assistance programs through your county or State housing authority, or your municipality or city, but it’s best to ask your favorite professional lender representative because they know what’s available and the details of the various programs. For example, some local banks believe in giving back to its local communities and typically set aside funds every year to be used for down payment assistance programs for those that qualify.

Gifts From Family

If you are expecting an inheritance from your family later in life, perhaps they would be willing to gift it to you sooner. Asking family for financial help might make you feel uncomfortable, but all you have to do is start the conversation. You never know unless you try.

Low-Down-Payment Loans

Some specific types of loans generally have lower requirements for down payment funds. For example, HUD and FHA usually offer low-down-payment programs to borrowers who qualify. If you live in Washington State, The Washington State Housing Finance Commission is another excellent place to start.


It’s never too late to start saving for a down payment. It may seem out of reach at first, but if you put your mind to it, you can accomplish just about anything. Even only a few dollars a day can make a huge difference. Perhaps you can start a side gig, or home based business to help you raise funds. Get creative and see what you can do.

Tax Refunds

Tax Refunds are another great option for coming up with a down payment for buying a home. Instead of using your tax refund for a vacation or consumer goods, put it aside for buying a home of your own. Save your tax refund for a couple of years, and you might have enough of a down payment to buy a house.

Retirement Funds

We know you that protecting your retirement funds is essential, but so is purchasing a home. Perhaps it’s time to consider tapping into your retirement funds a little and use that money as your down payment? Talk to your financial adviser or CPA and weigh the pros and cons of using your retirement funds early.

There are many ways to acquire money for a down payment on a home of your own. Put your mind to it and come up with a plan, and don’t hesitate to call us with any questions you may have regarding the process.

Note: Opinions expressed are solely my own and do not express the views of my employer.