DPA isn't just for your down payment — closing costs count too.

When people hear "down payment assistance," they picture help with the down payment — and yes, that's the main event. But a lot of buyers don't realize that many DPA programs can also be applied to closing costs. And closing costs are no small thing.

What closing costs actually are

Closing costs are the fees and prepaid expenses you pay when finalizing a home purchase. They typically run 2–3% of the loan amount. On a $400,000 purchase, you're looking at roughly $8,000–$12,000 on top of your down payment. That's money most buyers scramble to find — or didn't budget for at all.

These costs include things like:

• Loan origination fees
• Appraisal and inspection fees
• Title insurance and escrow
• Prepaid property taxes and homeowners insurance
• Government recording fees

How DPA can cover closing costs

Some DPA programs specifically allow their funds to be used toward closing costs in addition to — or instead of — the down payment, depending on which is most pressing. If you have enough saved for a small down payment but can't cover the closing costs on top of that, some programs let you direct the assistance dollars exactly where you need them most.

Seller concessions: another tool

Separate from DPA, you can often negotiate with the seller to contribute toward your closing costs. This is called a seller concession or seller credit. FHA loans allow up to 6% in seller concessions; conventional loans have their own caps. In a buyer-friendly market, or with the right negotiation, this can eliminate a large chunk of your out-of-pocket closing burden.

Combining both strategies

The most effective approach is often to combine DPA with seller concessions: use DPA to cover the down payment, negotiate seller concessions to cover closing costs, and arrive at the closing table with as little cash out of pocket as possible — while still getting a strong loan.

People focus so much on the down payment that closing costs blindside them. Let's make sure that doesn't happen to you.

Planning for both down payment and closing costs upfront means no surprises. When you're ready to start looking at what you'd actually need on closing day, reach out and let's build that full picture together.