With a 3% concession, a $350,000 mortgage would rise to $360,500. So your monthly payments would go up by $55 a month (assuming a 30-yr fixed-rate mortgage at a 4.75% interest rate). You would also be paying $9,218 more in interest over the life of your loan.
Is a seller’s concession a good idea?
Benefits Of Seller Concessions Agreeing to concessions can be good for the seller in some circumstances. For example, they can help the seller get their home off the market faster. If the seller is eager to close on the sale, they may be willing to pay part of the buyer’s closing costs to speed up the process.
What do you mean by seller’s concession in real estate?
© kali9/Getty Images Home sellers agree to contribute to a homebuyer’s closing costs. What are seller concessions? A seller concession is a portion of the buyer’s closing costs and prepaid expenses that the seller agrees to pay for, lowering the overall upfront costs for the buyer.
Is the closing cost credit the same as a seller concession?
First, it’s important to know a seller concession, seller contribution, seller credit and closing cost credit are the same thing. So if you’re buying a home and your lender suggests asking the seller for a closing credit it’s the exact same thing as a seller concession.
Are there any drawbacks to seller concessions?
Now, there may be a few drawbacks to seller concessions, like a low appraisal. However, if both parties go into the situation knowing this is a possibility it could become a non-factor. Not all home buyers need seller concessions, so sellers should never dismiss an offer asking for seller concessions.
Where did the idea of seller’s concessions come from?
The origin of the anti-Seller Concession mentality was a world where you’re financing an extra six percent on top of a loan that’s got a 15 percent interest rate. You can see where this was all kinds of wrong, and, at one point, it made for a loan you’d spend half your life trying to escape.
