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Answers (13)
- Isaac Weiser, "The123Mortgage"
- Contributions:14
Are you raising the sale price by 3.5% or just giving 3.5%?
Concession is common and legal. If you pay anything toward closing, you are helping the deal go through. You might negotiate a better sale price if you're paying toward the closing .. its a win-win situation for buyers and sellers, and for banks too, assuming there is an established equity in the house.
Oh, and buyer will pay you back the difference of taxes on higher sale price in ratio to the concession percentage on the closing table, so you are not losing.
Concession is common and legal. If you pay anything toward closing, you are helping the deal go through. You might negotiate a better sale price if you're paying toward the closing .. its a win-win situation for buyers and sellers, and for banks too, assuming there is an established equity in the house.
Oh, and buyer will pay you back the difference of taxes on higher sale price in ratio to the concession percentage on the closing table, so you are not losing.
- Jay Dubrinsky, "Jay D1"
- Contributions:4
This is not an unreasonable request. Of the purchase transactions I have done mortgages for in the last 6 months, about 75% of the time the seller asked to pay between 3 and 6% of the buyer's closing costs and pre-paids. In many cases, it is the difference between the buyer being confident enough to purhcase at this time or having them wait to "Save more money"
Best wishes,
Jay
- sunnyview
- Contributions:25139
3.5% is not unreasonable in this market, but you can always counter the buyers and offer to split the cost. You might also consider offering the 1.75% split and a home warranty that would be cheaper for you than the additional percentage of closing costs.
I understand your situation, but you have to do what you can to get it closed so you can move on. Try to offer something lower and if they buyers really like the house, they will probably accept. Wishing you good luck with your sale.
I understand your situation, but you have to do what you can to get it closed so you can move on. Try to offer something lower and if they buyers really like the house, they will probably accept. Wishing you good luck with your sale.
- Gordon Haraway, "1stTimebuySpecialist"
- Contributions:250
The only thing you need to remember is "The Market Doesn't Care"
"The Market Doesn't Care how much you are losing on your home
"The Market is the market and giving up 3.5% to pay towards the buers closing costs is not unreasonable anywhere is the country these days.
Is it a little much? maybe but if it is a legidimate offer and the only one you have received then iot may very well be the best offer you can expect.
If you house has only been lised a few days then you can ttry and play hardball and counter back with less. Just remember the buyer can also walk away from your counter.
Also ask yourself how much it is going to cost you for every month you go and not selling. after a couple months you will need to lower the asking price and then your just chasing the market and will likely lose even more when you finally do sell. Best of luck
"The Market Doesn't Care how much you are losing on your home
"The Market is the market and giving up 3.5% to pay towards the buers closing costs is not unreasonable anywhere is the country these days.
Is it a little much? maybe but if it is a legidimate offer and the only one you have received then iot may very well be the best offer you can expect.
If you house has only been lised a few days then you can ttry and play hardball and counter back with less. Just remember the buyer can also walk away from your counter.
Also ask yourself how much it is going to cost you for every month you go and not selling. after a couple months you will need to lower the asking price and then your just chasing the market and will likely lose even more when you finally do sell. Best of luck
All we need is about 10 more agents to come and answer the exact same thing and this will be Trulia.
- Robert Mack, "robert.mack"
- Contributions:2
It really depends on your specific local market, the demand for your home, and the type of loan the buyers are using. Obviously, if you have multiple offers on your property you can pick and choose who you'd like to work with, however, if you only have one offer you are currently working with, it is in your best interest to reach a mutually beneficial situation where both you and the buyers you are working with have a win-win situation. Keep in mind that if the buyer is using an FHA loan with a 3.5% down payment, the chances are that they are scraping together what they have just to come up with the down payment, and in many cases may not have the ability to buy your home without your help. With that being said, the total net to you should make sense as well. If your list price is realistic and they are coming in much lower and asking for credits, maybe they need to bump up their offer price a bit so that it makes to you. You work with them and give them the credits for closing costs, and they work with you and get you a price that nets you a reasonable amount in your current local market. I tell all my sellers that right now, LESS is MORE! The reality is that if you don't make it work with this buyer, the chances are you will ultimately get less from someone else so try and make it work out. I am a firm believer in a win win situation for everyone involved. If it isn't a win-win, then the party that feels like they are losing WILL find a way to make it up in the end! You mentioned you are taking a loss on the home, and you are not alone, however the longer the home is listed, the larger the loss may be. Quick sales = Highest net.
- wayne lancaster, "funds2"
- Contributions:1177
In today's buyers market it is common for low offers and request for seller to pay closing cost. If you are fortunate and buyer really wants your house but is short of funds there is an option of buyers lender increasing rate and paying some or all of buyers closing cost. It is actually cheaper monthly for buyer if sales price is increased to cover closing cost vs increasing interest rate, but that seems to be harder to negotiate.
If buyer is not flexible you may have to be, but see if your Realtor's can explore any flexibility that might exist before you have to bite the bullet.....
If buyer is not flexible you may have to be, but see if your Realtor's can explore any flexibility that might exist before you have to bite the bullet.....
- Ryan Halset, "RyanHalset"
- Contributions:730
It really depends on your market, the transaction, the selling price, condition of the home, etc.
In Seattle, my buyers almost always get at least a portion of their closing costs covered by the seller. But that is in large part because of condition of the market. If your home received an offer on the first day or there are multiple bids on your home, then you can obviously negotiate a bit more. If the buyers are first time home buyers, they may actually need the closing costs covered in order to have enough funds for closing. If that's the case, perhaps the ultimate selling price isn't the most important thing to them. If closing costs are about $5,000...an option could be to respond by saying that if they want closing costs covered, you will raise the price by $5,000. That might be a difference of $25/month in mortgage payment to the buyer (at today's rates)...but the buyers may be thrilled that they don't have to come to closing with an extra $5k.
Either way, this is a matter that your agent should be giving you solid direction because each transaction and market is unique.
In Seattle, my buyers almost always get at least a portion of their closing costs covered by the seller. But that is in large part because of condition of the market. If your home received an offer on the first day or there are multiple bids on your home, then you can obviously negotiate a bit more. If the buyers are first time home buyers, they may actually need the closing costs covered in order to have enough funds for closing. If that's the case, perhaps the ultimate selling price isn't the most important thing to them. If closing costs are about $5,000...an option could be to respond by saying that if they want closing costs covered, you will raise the price by $5,000. That might be a difference of $25/month in mortgage payment to the buyer (at today's rates)...but the buyers may be thrilled that they don't have to come to closing with an extra $5k.
Either way, this is a matter that your agent should be giving you solid direction because each transaction and market is unique.
- Michael Helton
- Contributions:456
Andrea, it is normal and acceptable. Whether or not you want to pay it is up to you.
I know this is very hard to do, but you cannot think about how much you are losing. If you really want to sell now, the market is going to dictate the price.
You could hold your ground and pay no closing costs, but you have to ask if you are willing to lose the sale because of it.
Good luck.
I know this is very hard to do, but you cannot think about how much you are losing. If you really want to sell now, the market is going to dictate the price.
You could hold your ground and pay no closing costs, but you have to ask if you are willing to lose the sale because of it.
Good luck.
- Bill Smith, "billsmith."
- Contributions:37
It depends on what is normal for your area. In Orange County, Ca., Buyers and Sellers pay all their own costs. Your Realtor should have the answer.
- Diane Menard, "dmenard"
- Contributions:22
When I take a listing I sit down with my sellers and we do an estimated net sheet and I include the seller paying for 3% in closing costs since it is very rare for a buyer not to want seller paid closing costs. The key to doing this is so my seller's are prepared when they do get that offer. There are companies offering to pay 3.5% if the buyer closes by a particular date. The question being is what is the norm around you. I have gotten offers where buyers ask for the full 6%. Hope this helps you!
- AndreaNerren Lane
- Contributions:2
I am not totally sure of the cost, but it looks like it could be about $5000. we are already taking about a $45,000.00 loss, so should we counter offer with a lower precentage on the closing costs? I am just trying to save us alittle money, and with this economy we need all the help we can get.
- shapiroamg
- Contributions:3058
What is the dollar total of the 3.5%? Excluding points a buyers closing coasts and escrows might run in the $5-7k range.
is paying 3.5% of closing for the buyer reasonable or not? we are taking a loss on this house.
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