The following video (1:32 minutes) is about how Massachusetts and New Hampshire home buyers can pay for closing costs when puchasing a home. Learn about how a home buyer can use a seller concession – sometimes referred to as a buyer credit – at closing to pay for closing costs and have money after to closing for repairs or just unexpected costs.
The following is the transcript of the video above about paying for closing costs when buying a home.
Hi, I'm David Kres from Buyers Brokers Only, LLC. Buyers often ask me about a selling concession for closing costs. Here's how it works. Let's say there's a purchase price of $200,000 and the buyer's estimated closing cost is about $6,000. The buyer has a choice. They can pay $200,000 for the property and pay their $6,000 of closing costs at the closing. Or what they can do is they can have a seller concession for closing costs and ask the seller to pay those costs.
The way that would work is the buyer and seller agree to increase the purchase price to $206,000 with the seller giving the buyer $6,000 seller concession for closing costs. It's really a cash flow decision on the buyer's part, whether or not they want to pay their closing costs at the closing for the lowest amount of mortgage as possible or increase the purchase price and roll their closing costs into the mortgage.
To the seller it's going to be the same net sale price of $200,000 one way or another so it's really again a cash flow decision on the buyer's part. If you have any additional questions on a sellers concession for the closing costs or anything else related to real estate, please give me a call any time.