Builder Deposits on New Homes in Palm Beach County: When Your New Construction Down Payment Is Due and When to Lock Your Rate

Your new construction down payment is not one check. With a builder, you usually pay a deposit when you sign, sometimes more deposits as the home goes up, extra money for upgrades and then the rest of your down payment at closing. In Palm Beach County and Port St. Lucie, where many new homes take months to finish, that timeline also raises a second question: when should you lock your mortgage rate? This guide explains each payment, how Florida law treats builder deposits and what to ask the sales office before you sign.

Key takeaways

• Builder deposits are paid under your purchase contract. Your loan down payment is due at closing, and your deposits are usually credited toward it.
• Florida law gives buyers of new one- and two-family homes from larger builders the right to have deposits, up to 10% of the price, held in escrow.
• Upgrade deposits for design choices are often due early and may not be refundable. Read that part of the contract closely.
• Standard rate locks run 30, 45 or 60 days. A home that takes months to build may need a longer lock, and that can cost more.
• Keep your income, debts and savings steady while the home is built. The lender will check again before closing.

How a new construction down payment works with a builder

When you buy a resale home, you put down an earnest money deposit, and the rest of your cash comes at closing. A new build follows the same idea but stretches it out. The builder wants proof you are serious before it starts work on your home. So the contract sets a deposit schedule.

Here is the usual order of payments.

1. Initial deposit at contract. You pay this when you sign. Some builders take a small reservation fee first to hold a lot.
2. Additional deposits. Some contracts ask for more at set points, such as when permits are issued or when the slab is poured.
3. Upgrade or option deposits. These cover design center choices like flooring, cabinets or a pool.
4. Balance at closing. The rest of your down payment and closing costs come due when the home is finished and the loan funds.

Each builder sets its own amounts. We won't quote a "standard" percentage, because it varies by builder, community and even price point within the same community. Ask for the full deposit schedule in writing before you sign anything.

Builder deposits vs. your loan down payment

Buyers often mix these up. The builder deposit is money you pay the seller under the contract. The down payment is the part of the price your mortgage doesn't cover. In most cases, the deposits you've already paid count toward the down payment at closing.

For example, say you buy a $500,000 home with 10% down, or $50,000. If you paid $25,000 in builder deposits, you would bring roughly the other $25,000 to closing, plus closing costs. Your lender and title company will show the exact figure on your Closing Disclosure.

There is one catch. Your lender will want to see where the deposit money came from. So keep bank statements that show each payment leaving your account. Large, unexplained deposits into your account before or after can slow down the loan.

Where upgrade deposits fit in your new construction down payment

Upgrades raise the price of the home. Some builders roll the cost into the final price, and your loan can cover part of it. Others ask for upgrade money in cash, up front. Many contracts treat upgrade payments as nonrefundable once the work is ordered, because the builder can't easily resell a custom choice.

Also think about the appraisal. A lender lends based on the lower of the price or the appraised value. If you load up on upgrades, the appraisal may not keep pace. In that case, you would cover the gap in cash on top of your down payment.

How Florida law protects new construction deposits

Florida has a statute just for this. Section 501.1375 of the Florida Statutes covers deposits on one-family and two-family homes sold by a builder or developer that builds or sells 10 or more units a year in the state.

Under that law, the buyer has the right to have deposit funds, up to 10% of the purchase price, placed in an escrow account. Your contract must say so in a conspicuous notice. An escrow agent can be a bank, savings and loan, trust company, Florida attorney, licensed real estate broker or title insurance company.

The law also lets the builder use escrowed funds for construction in some cases. To do that, the builder must notify the buyer and either post a surety bond payable to the buyer for the deposit amount or follow another method the statute allows. When the deal ends, the funds are released based on what happened.

• If the contract is terminated, the deposit goes back to the buyer with interest earned.
• If the buyer defaults, the funds can go to the builder after notice.
• At closing, the funds are applied to the sale.

Deposits above 10% of the price fall outside that escrow right. So if a contract asks for more than 10% before closing, ask how the extra will be held and what happens to it if the builder can't finish.

Condos follow a different law, chapter 718, with its own deposit and cancellation rules. If you are looking at a condo tower, the rules above don't apply in the same way.

When to lock your rate on a new build

A rate lock means your interest rate won't change between the offer and closing, as long as you close on time and nothing in your application changes. The CFPB says locks are typically available for 30, 45 or 60 days, and sometimes longer.

That works fine for a resale home. But if your new build is six months from done, a 60-day lock won't reach closing. You have three broad choices.

• Wait and lock later. You lock once the builder gives a firm closing date. You take the risk that rates rise in the meantime.
• Take an extended lock. Some lenders offer longer locks for new construction. These often cost more, either as an upfront fee or a slightly higher rate.
• Use a lock with a float-down. Some extended locks let you take a lower rate if the market drops. Ask what triggers it and what it costs.

Also ask what happens if the builder runs late. The CFPB notes that extending an expired lock may be expensive. Weather, inspections and supply delays are common reasons new homes slip. So ask who pays an extension if the delay is the builder's fault.

Builder lenders and new construction down payment incentives

Many builders have a preferred or affiliated lender. They often tie incentives to it, such as help with closing costs or a lower rate. These can be real savings. Still, compare the full offer with an outside Loan Estimate. Look at the rate, the points and the total fees, not just the size of the incentive. Our guide to the new construction buying process covers other steps where an outside view helps.

Keep your loan approval steady while the home is built

Your lender may pre-approve you at contract, but final approval comes near closing. Between those dates, the lender may pull credit again and re-verify your job and savings. A lot can change in six months. So follow a few simple rules.

• Don't open new credit cards or finance furniture before closing.
• Keep your down payment in the account the lender already reviewed.
• Tell your lender right away about a job change.
• Get homeowners insurance quotes early. In Florida, insurance cost can change your approval amount.

Questions to ask the sales office about the new construction down payment

1. What is the full deposit schedule, and when is each payment due?
2. Who holds the deposits, and are they in escrow?
3. Will the builder use my deposit for construction? If so, is there a surety bond?
4. Which deposits are refundable, and in what cases?
5. Are upgrade payments due in cash, or can they go into the loan?
6. What is the estimated completion date, and what happens if it slips?
7. What incentives depend on using the builder's lender?

A buyer's agent can ask these questions for you and compare the answers across communities. That matters in growing areas like Westlake and Port St. Lucie, where several builders may sell side by side with different terms.

New construction or resale?

Deposit timing is one reason some buyers choose a resale home instead. A resale usually needs only an earnest money deposit and closes in weeks. A new build ties up cash for months, but you get a new roof, new systems and a builder warranty. In August 2026, Palm Beach County single-family homes had a median price of $650,000 and 3.5 months of supply, according to Miami Realtors. That supply gives buyers a real resale option to weigh against a new build.

Frequently asked questions

When is the down payment due on a new construction home?

The remaining down payment is due at closing, when the home is complete and the loan funds. Before that, you pay builder deposits under the contract, and those deposits are usually credited toward your down payment.

Is a builder deposit refundable in Florida?

It depends on the contract. If the contract is terminated in a way that entitles you to a refund, Florida law says escrowed deposits go back with interest. If you default, the builder may keep them. Upgrade deposits are often nonrefundable.

Can I use a gift for my new construction down payment?

Many loan programs allow gift funds, with a signed gift letter and a paper trail. Ask your lender how the gift must be documented, especially if it will pay a builder deposit months before closing.

How long can I lock my rate on a new build?

Common locks are 30, 45 or 60 days. Some lenders offer longer locks for new construction, usually at extra cost. Ask each lender for the price of the lock length you need.

Do I need a construction loan to buy from a builder?

Usually not. When a builder sells a finished home in its own community, the builder funds construction, and you close on a standard purchase loan. A construction loan is more common when you hire a builder to build on land you own.

Sources

• Florida Statutes, section 501.1375 (buyer deposits on residential dwelling units)
• CFPB, What is a rate lock?
• CFPB, What is a Loan Estimate?
• Miami Realtors, Palm Beach County August 2026 market report

Selling to buy new? Timing your sale with a builder's closing date takes planning. Check what your current home is worth or talk with a listing agent. Buying? Get a new construction vs. resale comparison from a Pure Equity agent before you sign a builder contract.