Which type of payment is typically required from buyers when purchasing a property?

The down payment is a crucial part of the home-buying process, representing a percentage of the property's total purchase price that the buyer must pay upfront. This payment demonstrates the buyer's commitment to the transaction and reduces the amount of money that must be borrowed. The down payment amount varies depending on the loan type, with some loans allowing for lower down payments while others may require higher percentages.

Understanding the importance of the down payment is essential as it affects the buyer's mortgage terms, monthly payments, and overall financial responsibility. It can also influence the buyer's ability to secure financing, as lenders often consider the size of the down payment when assessing a borrower's risk profile.