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Everything You Need to Know About Seller's Concessions Have you heard a real estate agent using the term 'seller's concessions' and wondered what it meant? Buying a home can stretch your finances to the limit, with closing costs that could be as much as 5% of the purchase price. This can make purchasing the home you want very difficult, but there is a possible way to have the seller help you with these closing costs. If the situation is right, sometimes the seller might be willing to help with these costs. These are known as seller concessions, and they could
Do you plan on buying a house in the near future? If so, you're probably thrilled at the prospect of becoming a homeowner. Most first time buyers are excited about their purchase but also fearful at the same time.
Let's face it - taking on a mortgage is a significant financial responsibility. When buying a home there are a lot of hidden costs that some buyers don't properly plan for. One of these types of expenses are closing costs.
The amount of money it takes to close on a house can be substantial for cash strapped buyers. You may have plenty to cover the down payment and enough to get by to cover the closing costs but there won't be much left in reserve.
Fortunately, there is a way to have some of your closing costs covered by the seller. The process is known as getting seller concessions. With a seller concession the owner of the house you are purchasing will help pay your closing costs.
Even in hot markets that favor sellers offers can be written such that the seller is not really paying out of pocket for the seller concessions.
For example, let's say you want to purchase a home that is listed for $350,000 and the seller expects a full price offer. What you would do is offer $360,000 with the seller paying 10,000 of your closing costs.
Writing the contract this way ends up being a win-win for both buyer and seller. The buyer gets the house they want without paying for their closing costs and the seller gets their asking price.
Of course, if it were a buyers market the same offer could be written such that the seller just pays for the closing costs.