A buyer obtains a loan for 90% of a $190,000 house. If they have already paid $3,800 in earnest money, how much additional cash must they provide for the down payment?

• A. 15,200
• B. 15,000
• C. 13,800
• D. 19,000

Answer: (A)

The amount financed is 90% of the purchase price, so the down payment required is 10% of $190,000, which is $19,000. The buyer has already paid $3,800 in earnest money, and that money is typically credited toward the down payment at closing. So the additional cash needed is $19,000 minus $3,800, which equals $15,200. Therefore, the buyer must provide $15,200 more cash.