When you buy a home, you need money for 2 things: the down payment and the closing costs. These costs can be expensive, this is where a Seller Concession helps you. A Seller Concession is when the seller agrees to give some money back to you at the end of the sale. Instead of lowering the price of the home, the seller pays for some of your costs.
The amount of money a seller can pay depends on the type of loan you use:
• FHA Loans (for primary property): With a 3.5% down payment, the seller can pay up to 6% of the price toward your costs.
• VA Loans (for primary property): With 0% down, the seller can pay up to 4% for specific items plus your normal closing costs.
• Conventional Loans (for primary & second homes): The amount the seller can pay depends on your down payment. If you put down less than 10%, the seller can pay 3%. If you put down 10% to 25%, they can pay 6%. If you put down more than 25%, they can pay up to 9%.
• Conventional Loans (for investment homes): With 15% or more down, the seller can pay up to 2%.
Here’s a breakdown to help you understand the numbers better.
Source: Mike Hoyt of OriginPoint
How does it help the Buyers?
Negotiating a concession lowers your upfront costs and keeps your monthly payment manageable.
How does it help the Sellers?
Offering a concession attracts more buyers and speeds up the sale without reducing your list price.
I am Shirin Rezania Ramos, and I am here to help real estate process simple and stress-free. Whether you are buying or selling your home, I can help you use these strategies to get the best deal possible. Reach out to me today, and let’s find the perfect path for your next move. Call me today at 858-345-0685 and let’s talk about your strategies!
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Shirin Rezania Ramos | 858.345.0685 | www.shirinramos.com | Compass, DRE 02033796
