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New down payment rules & what they mean to you.

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Thinking about making a property purchase in 2016? If so, you should know that the minimum down payment will be changing for homes between $500,000 and $1 million. Currently a purchaser must put a minimum down payment of 5% down on a home with a purchase price up to $1 million.

As of February 15, 2016 properties between $500,000 and $1 million will require a bit more down. 5% down will still be required on the 1st $500,000, but now 10% down will be required on any amount above that, up to $1 million. So what does that look like?

Let's take a property that will be purchased for $650,000:

Before February 15, 2016 the minimum down payment is 5%

$650,000 × 5% = $32,500

Minimum down payment required = $32,500

After February 15, 2016 the amount above $500,000 will require 10% down

$500,000 × 5% = $25,000 PLUS the remaining $150,000 × 10% = $15,000

Minimum down payment required = $40,000