Why agents care
A buyer can afford the payment and still fall short on cash to close. Calculating it early, before the offer, lets agents ask for concessions or adjust the price range instead of scrambling in week three of escrow.
Glossary term
Cash to close
Cash to close is the amount a buyer must bring to the closing table. It's the down payment plus closing costs and prepaids, minus credits such as the earnest money deposit, seller concessions and lender credits. It appears on both the Loan Estimate and the Closing Disclosure.
Example
Example: a $42,500 down payment plus $11,400 in closing costs, minus a $5,000 earnest money deposit already paid, means about $48,900 due at closing.
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Questions by topic
Cash to close: common questions
Does cash to close include the earnest money?
The earnest money is credited toward it, so the remaining cash due at closing is lower by that amount.
When do buyers find out the exact figure?
The Closing Disclosure, delivered at least three business days before closing, shows the final cash to close.
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