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LIBOUND
Texting king
Member since 10/05 5289 total posts
Name:
Suzy
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CLOSING COSTS-UPDATE ON BOTTOM
My DH and I are really green about this entire home buying process and really havent had too many people to consult with, but you guys really seem to be in the know.
I found a house that the seller doesn't want to do a "sellers concession", but shouldn't they be the ones to pay closing costs??
Can you guys tell me how you took care of this in your contracts??
TIA
Message edited 12/3/2005 11:16:20 PM.
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Posted 12/3/05 8:00 AM  |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS
Posted by LIBOUND
My DH and I are really green about this entire home buying process and really havent had too many people to consult with, but you guys really seem to be in the know.
I found a house that the seller doesn't want to do a "sellers concession", but shouldn't they be the ones to pay closing costs??
Can you guys tell me how you took care of this in your contracts??
TIA
Closings are the buyers responsibility...They are the ones that need all that info for their Mort. Co and banks etc etc...
so although i don't like it ...it makes sense that they pay it.
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| Posted 12/3/05 8:54 AM |
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skew
LIF Adult
Member since 5/05 6794 total posts
Name:
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Re: CLOSING COSTS
hmm, why is the seller offering a concession? in this competitive market, seller concessions are a rarity and i would w/o a doubt question why it is being offered. what would make more sense to me and make me feel more comfortable (as a buyer) is a reduction in the asking price as opposed to a sellers concession. another option is for the sellers to pay the real estate commissions.
whatever choice is made make SURE it is in writing and you consult w/ an attorney and mortgage rep.
do you have any advice Pill?
Message edited 12/3/2005 9:48:54 AM.
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| Posted 12/3/05 9:45 AM |
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PiyoPika566
talk to the hand
Member since 5/05 1436 total posts
Name:
Stephanie
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Re: CLOSING COSTS
Posted by LIBOUND
My DH and I are really green about this entire home buying process and really havent had too many people to consult with, but you guys really seem to be in the know.
I found a house that the seller doesn't want to do a "sellers concession", but shouldn't they be the ones to pay closing costs??
Can you guys tell me how you took care of this in your contracts??
TIA
does sellers ever pay for closing costs? I've never heard of it.. closing cost are costs that the buyers have accumulated, therefore the buyers should pay it.. it's PITA but it's unavoidable...
and a sellers consession is really an favor that the sellers would do for their buyers, they don't have to, and it's not the norm.
Are you and your DH putting money down? if so, I would see if the seller would allow you put less down, so you can use the rest to cover some closing cost....
or you'll have to come up with the closing cost somewhere else.. it's probably around 20k give or take some....
I am not an expert, but we are in the process of buying and this is from what I understand....... I hope this helps some.
Good luck!
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| Posted 12/3/05 11:02 AM |
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skew
LIF Adult
Member since 5/05 6794 total posts
Name:
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Re: CLOSING COSTS
Posted by PiyoPika566
Posted by LIBOUND
My DH and I are really green about this entire home buying process and really havent had too many people to consult with, but you guys really seem to be in the know.
I found a house that the seller doesn't want to do a "sellers concession", but shouldn't they be the ones to pay closing costs??
Can you guys tell me how you took care of this in your contracts??
TIA
does sellers ever pay for closing costs? I've never heard of it.. closing cost are costs that the buyers have accumulated, therefore the buyers should pay it.. it's PITA but it's unavoidable...
and a sellers consession is really an favor that the sellers would do for their buyers, they don't have to, and it's not the norm.
Are you and your DH putting money down? if so, I would see if the seller would allow you put less down, so you can use the rest to cover some closing cost....
or you'll have to come up with the closing cost somewhere else.. it's probably around 20k give or take some....
I am not an expert, but we are in the process of buying and this is from what I understand....... I hope this helps some.
Good luck!
although rare, sellers do sometimes offer to pay closing costs. not sure of the reasoning in this case but the advantage to the buyer is that they don't have to come up w/ the extra $$$ to cover the costs at closing. as i mentioned previously, i would feel more comfortable if the sellers reduced the asking price. this will lower the mortage but the buyer will still have to come up w/ the needed cash at closing. if the price remains and the sellers offer to pay the closing costs, the mortage will be higher but disposable $$$ would not be needed at closing.
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| Posted 12/3/05 11:22 AM |
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LSP2005
Bunny kisses are so cute!
Member since 5/05 19457 total posts
Name:
L
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Re: CLOSING COSTS
In our closing the sellers ended up paying 24,000 for their closing costs (including their attorney, and the cost of the realtors). Our closing costs were about 9,000 (title insurance, attorney fee, taxes, homeowners association fee).
Our sale price was listed higher than it actually was since the seller gave us money back at closing for things that we discovered through the inspection. (We are in NJ).
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| Posted 12/3/05 11:26 AM |
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PiyoPika566
talk to the hand
Member since 5/05 1436 total posts
Name:
Stephanie
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Re: CLOSING COSTS
Posted by Skew
although rare, sellers do sometimes offer to pay closing costs. not sure of the reasoning in this case but the advantage to the buyer is that they don't have to come up w/ the extra $$$ to cover the costs at closing. as i mentioned previously, i would feel more comfortable if the sellers reduced the asking price. this will lower the mortage but the buyer will still have to come up w/ the needed cash at closing. if the price remains and the sellers offer to pay the closing costs, the mortage will be higher but disposable $$$ would not be needed at closing.
Posted by LSP2005
In our closing the sellers ended up paying 24,000 for their closing costs (including their attorney, and the cost of the realtors). Our closing costs were about 9,000 (title insurance, attorney fee, taxes, homeowners association fee).
Our sale price was listed higher than it actually was since the seller gave us money back at closing for things that we discovered through the inspection. (We are in NJ).
wow, I hope the next time we buy, we meet one of these more flexible sellers...
anything is possible I guess!
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| Posted 12/3/05 11:44 AM |
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LSP2005
Bunny kisses are so cute!
Member since 5/05 19457 total posts
Name:
L
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Re: CLOSING COSTS
Posted by PiyoPika566
Posted by Skew
although rare, sellers do sometimes offer to pay closing costs. not sure of the reasoning in this case but the advantage to the buyer is that they don't have to come up w/ the extra $$$ to cover the costs at closing. as i mentioned previously, i would feel more comfortable if the sellers reduced the asking price. this will lower the mortage but the buyer will still have to come up w/ the needed cash at closing. if the price remains and the sellers offer to pay the closing costs, the mortage will be higher but disposable $$$ would not be needed at closing.
Posted by LSP2005
In our closing the sellers ended up paying 24,000 for their closing costs (including their attorney, and the cost of the realtors). Our closing costs were about 9,000 (title insurance, attorney fee, taxes, homeowners association fee).
Our sale price was listed higher than it actually was since the seller gave us money back at closing for things that we discovered through the inspection. (We are in NJ).
wow, I hope the next time we buy, we meet one of these more flexible sellers...
anything is possible I guess!
I always thought the seller pays their attorney fee and the real estate agents???? Those costs come out of the selling price of the home. The realtor fee is a % of the sale price - so for a 400,000 home 6% is 24,000. The seller also paid their attorney - about 1,000. So for the seller the sale price needs to account for:
Sale price minus realtor fees minus lawyer fees minus their moving fees minus remaining mortgage minus remaining utilities/taxes = profit for seller.
Does that make sence?
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| Posted 12/3/05 12:07 PM |
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patti08
Happy
Member since 5/05 3893 total posts
Name:
Patti
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Re: CLOSING COSTS
We did a seller concession. We setteled on a sale price in and then added our closing costs into the loan, the seller actually lost no money in the concession, we just borrowed a little more. It made it very easy for us. The "concession" just legally shows them giving the $ back to us at time of closing.
Sorry your sellers aren't being flexible.
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| Posted 12/3/05 1:35 PM |
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DjPiLL
Member since 5/05 3664 total posts
Name:
Richard
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Re: CLOSING COSTS
Doing a seller's consession can be tricky, but not impossible.
First off... the seller has to agree to do it. Even though the seller loses no money out of the deal... its not usually best for the seller to do this.
The buyer takes the money for closing costs and adds them onto the loan. But the bank has to approve and appraise the home for the value plus the closing costs. This is not always possible and could be a deal breaker and risky for the seller.
There are only two times where it would be beneficial to the seller to do this. #1 would be in a housing market thats slow or a house that just hasn't sold forever and they want to move it. Or #2 the seller agrees to pay the closing costs... but they also tack on another couple thousand extra onto the loan for the "convienence" of doing this for the buyer. Again doing this the house has to appriase for that much and can be risky.
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| Posted 12/3/05 3:29 PM |
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skew
LIF Adult
Member since 5/05 6794 total posts
Name:
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Re: CLOSING COSTS
Posted by DjPiLL
Doing a seller's consession can be tricky, but not impossible.
First off... the seller has to agree to do it. Even though the seller loses no money out of the deal... its not usually best for the seller to do this.
The buyer takes the money for closing costs and adds them onto the loan. But the bank has to approve and appraise the home for the value plus the closing costs. This is not always possible and could be a deal breaker and risky for the seller.
There are only two times where it would be beneficial to the seller to do this. #1 would be in a housing market thats slow or a house that just hasn't sold forever and they want to move it. Or #2 the seller agrees to pay the closing costs... but they also tack on another couple thousand extra onto the loan for the "convienence" of doing this for the buyer. Again doing this the house has to appriase for that much and can be risky.
why do you think the seller has offered to do this?
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| Posted 12/3/05 5:52 PM |
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PiyoPika566
talk to the hand
Member since 5/05 1436 total posts
Name:
Stephanie
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Re: CLOSING COSTS
Posted by skew
Posted by DjPiLL
Doing a seller's consession can be tricky, but not impossible.
First off... the seller has to agree to do it. Even though the seller loses no money out of the deal... its not usually best for the seller to do this.
The buyer takes the money for closing costs and adds them onto the loan. But the bank has to approve and appraise the home for the value plus the closing costs. This is not always possible and could be a deal breaker and risky for the seller.
There are only two times where it would be beneficial to the seller to do this. #1 would be in a housing market thats slow or a house that just hasn't sold forever and they want to move it. Or #2 the seller agrees to pay the closing costs... but they also tack on another couple thousand extra onto the loan for the "convienence" of doing this for the buyer. Again doing this the house has to appriase for that much and can be risky.
why do you think the seller has offered to do this?
I think the original post said the seller of the house DOESN'T want to do a sellers concession.
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| Posted 12/3/05 6:06 PM |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS
Posted by PiyoPika566
Posted by skew
Posted by DjPiLL
Doing a seller's consession can be tricky, but not impossible.
First off... the seller has to agree to do it. Even though the seller loses no money out of the deal... its not usually best for the seller to do this.
The buyer takes the money for closing costs and adds them onto the loan. But the bank has to approve and appraise the home for the value plus the closing costs. This is not always possible and could be a deal breaker and risky for the seller.
There are only two times where it would be beneficial to the seller to do this. #1 would be in a housing market thats slow or a house that just hasn't sold forever and they want to move it. Or #2 the seller agrees to pay the closing costs... but they also tack on another couple thousand extra onto the loan for the "convienence" of doing this for the buyer. Again doing this the house has to appriase for that much and can be risky.
why do you think the seller has offered to do this?
I think the original post said the seller of the house DOESN'T want to do a sellers concession.
that is what i thought and i understand it completely.
If the seller is selling the home for top dollor...adding in the closing may make the house not able to appraise...
which then the deal would fall through.
ETA.. this just happened to me. The woman buying my condo wanted a seller consession...
It would not appraise for the total value plus closing costs...
It has been a real PITA and she had to take it out.
So if i was to do this again i would NOT want a sellers consession as well
Message edited 12/3/2005 6:22:13 PM.
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| Posted 12/3/05 6:20 PM |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS
As far as i know each person pays for their own attorney fee
and the realtors get paid by the seller
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| Posted 12/3/05 6:26 PM |
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skew
LIF Adult
Member since 5/05 6794 total posts
Name:
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Re: CLOSING COSTS
OMG, i can't beleive i TOTALLY misread the post. i guess Pill did as well or he just read mine and replied.
to answer the question that WAS posed, sellers are under no obligation to pay the buyers slosing costs. it is the responbility of the buyer unless noted in the contract by means of a "seller's concession".
Message edited 12/3/2005 6:39:15 PM.
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| Posted 12/3/05 6:38 PM |
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DjPiLL
Member since 5/05 3664 total posts
Name:
Richard
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Re: CLOSING COSTS
Posted by skew
OMG, i can't beleive i TOTALLY misread the post. i guess Pill did as well or he just read mine and replied.
Actually... I did read the original post as they did NOT want to do it. I knew what she was talking about.
But since we got on the topic of a seller's consession and you asked for my advice... i gave it. 
Frankly its my opinion that a buyer looking to do a seller's consession probably doesn't have the type of financials needed to buy the house in the first place. I don't think I would ever do this unless I knew I was getting a killer deal on the house.
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| Posted 12/3/05 8:31 PM |
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LIBOUND
Texting king
Member since 10/05 5289 total posts
Name:
Suzy
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Re: CLOSING COSTS
Thanks you guys..
What wound up happening is that they didn't want to do seller's concession with the other offers, but I had to up my offer a few $$$ more than my original bid. We're now waiting to see if the seller accepts our bid.
Wish us luck!!!
Message edited 12/3/2005 11:16:05 PM.
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| Posted 12/3/05 11:14 PM |
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skew
LIF Adult
Member since 5/05 6794 total posts
Name:
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by LIBOUND
they didn't want to do seller's concession with the other offers, but I had to up my offer a few $$$ more than my original bid.
Wish us luck!!!
i am confused by this statement and not sure where a seller's concession comes into play. did you increase your offer to appear more attractive then your orginal offer and others presented or did the sellers agree to a concession if you increased your offer?
good luck!
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| Posted 12/4/05 9:28 AM |
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DjPiLL
Member since 5/05 3664 total posts
Name:
Richard
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by skew
Posted by LIBOUND
they didn't want to do seller's concession with the other offers, but I had to up my offer a few $$$ more than my original bid.
Wish us luck!!!
i am confused by this statement and not sure where a seller's concession comes into play. did you increase your offer to appear more attractive then your orginal offer and others presented or did the sellers agree to a concession if you increased your offer?
good luck!
This is exactly what I was saying above.
A seller may do a consession if they get a high enough bid... and that offier is significantly higher than the next offer.
What would you take if you were a seller?
380k for a house with no concession
or 440k for a house with a sellers concession. Closing costs do not equal 60k so you are profiting on this deal.
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| Posted 12/4/05 5:02 PM |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by DjPiLL
Posted by skew
Posted by LIBOUND
they didn't want to do seller's concession with the other offers, but I had to up my offer a few $$$ more than my original bid.
Wish us luck!!!
i am confused by this statement and not sure where a seller's concession comes into play. did you increase your offer to appear more attractive then your orginal offer and others presented or did the sellers agree to a concession if you increased your offer?
good luck!
This is exactly what I was saying above.
A seller may do a consession if they get a high enough bid... and that offier is significantly higher than the next offer.
What would you take if you were a seller?
380k for a house with no concession
or 440k for a house with a sellers concession. Closing costs do not equal 60k so you are profiting on this deal.
THAT depends on how much the house is worth!
You can't go by this alone!
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| Posted 12/4/05 7:13 PM |
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PiyoPika566
talk to the hand
Member since 5/05 1436 total posts
Name:
Stephanie
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by Redhead
Posted by DjPiLL
This is exactly what I was saying above.
A seller may do a consession if they get a high enough bid... and that offier is significantly higher than the next offer.
What would you take if you were a seller?
380k for a house with no concession
or 440k for a house with a sellers concession. Closing costs do not equal 60k so you are profiting on this deal.
THAT depends on how much the house is worth!
You can't go by this alone!
I agree with Jen... I don't understand the reasoning behind the seller only offering a SC with a higher bid... I hope he's sure that the house will appraise that much including the SC... otherwise he'll lose his deal.... very risky business.
ETA: Good Luck LIBOUND, I hope everything works out for you!! 
Message edited 12/4/2005 7:38:24 PM.
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| Posted 12/4/05 7:35 PM |
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DjPiLL
Member since 5/05 3664 total posts
Name:
Richard
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by Redhead
THAT depends on how much the house is worth!
You can't go by this alone!
Im not saying if its a smart thing or not. I am saying that this is probably the reason why the seller is looking for the higher bid.
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| Posted 12/4/05 7:45 PM |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by DjPiLL
Posted by Redhead
THAT depends on how much the house is worth!
You can't go by this alone!
Im not saying if its a smart thing or not. I am saying that this is probably the reason why the seller is looking for the higher bid.
IMO it just doesn't make any sense.
The real pain of the Sellers Consession is that if they buyers are doing 100% financing and then having a sellers consession, that they won't be approved a mortgage and/or the house will not appraise for the value with the sellers consession.
If the house can and does appraise and the person can get a mortgage...WHO CARES how they pay for it?
So i am not getting the raising of the bid, except to get more money...
IMO this home owner is either playing games to get more money or an idiot
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| Posted 12/4/05 8:02 PM |
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LIBOUND
Texting king
Member since 10/05 5289 total posts
Name:
Suzy
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Re: CLOSING COSTS-UPDATE ON BOTTOM
what happened was that we put an offer on a house, but the realtor came back to say that there were three offers in front of ours, all wanting to do a sellers concession. The seller did not want to accept any of these offers. I was originally confused as to exactly what this was, but once it was explained to me, I understood what these people were trying to do. What we wound up doing was placing a higher offer, with no sellers concession. We're just waiting for the seller to accept/deny this offer....now the waiting begins, but I hope not for long.
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| Posted 12/4/05 8:03 PM |
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Redhead
You Live, You Learn
Member since 5/05 31871 total posts
Name:
Jennifer
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Re: CLOSING COSTS-UPDATE ON BOTTOM
Posted by LIBOUND
what happened was that we put an offer on a house, but the realtor came back to say that there were three offers in front of ours, all wanting to do a sellers concession. The seller did not want to accept any of these offers. I was originally confused as to exactly what this was, but once it was explained to me, I understood what these people were trying to do. What we wound up doing was placing a higher offer, with no sellers concession. We're just waiting for the seller to accept/deny this offer....now the waiting begins, but I hope not for long.
ahhhhhhhhhh....why not just offer the same as the highest bid, minus the sellers consession...
you would then be highly desired without offering up more money?
Anyway...GOOD LUCK!
I am sure you should hear soon!
EAT...wow i didn't realize sooo many people are doing this
Message edited 12/4/2005 8:08:39 PM.
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| Posted 12/4/05 8:08 PM |
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