Seller paid closing cost concessions are when sellers agree to pay some dollar amount or percentage toward the buyer’s closing costs (lender fees, insurance, attorney fees, escrow setup, etc).
But closing cost concessions from a seller aren’t “free money” and it’s a frequent home buyer topic so thought an example may help.
Buyer and Seller have agreed on the terms of a contract (we’re leaving all the other contract terms and details out for the sake of focusing just on the closing cost example):
WITH Seller Paid Closing Costs: Sales Price is $200,000. Sellers contribute $6,000 toward buyer’s closing costs. Buyers are still responsible for their down payment (based on the sales price) and any closing costs above $6,000.
WITHOUT Seller Paid Closing Costs: Sales Price is $194,000. Buyers responsible for their down payment (based on the sales price) and all of their closing costs expenses.
Some buyers have funds for down payment and reserves but need seller paid closing costs. Other buyers prefer to pay their own closing costs and take the lower sales price. Which is better? Well as with so many things when buying a Charlotte NC home…it depends on what works best for you 🙂
Copyright©2011 by Diane McDermott, All Rights Reserved, “Closing Cost Concessions – An Example for Charlotte NC Home Buyers”
The content of this blog is the original content of Diane McDermott, NC Residential Real Estate Broker in Charlotte NC’s real estate market serving neighborhoods in Charlotte NC