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Hi guys, I'm looking at a condo with an asking price of $242k and would like to know if it would be better to offer full asking price and ask for the seller to pay the closing costs or offer something like say $235k and pay the closing costs myself? I may try to offer $235k with the seller paying some of the closing costs but I don't know if that will fly. Thank in advance!
I think you are trying to use a concession. Only use concessions when absolutely necessary. Concessions are used to either 1. allow you to show more downpayment and borrow the closing cost. or 2. show the home as selling for more.
If you are asking the seller to pay your closing cost, You may be in for a tougher negotiation, because if I were the seller, I definately would not pay your escrow, or your title insurance or for that matter you homeowner's insurance.
All concessions must be on the initial offer, you cannot sneak them in anymore, and the home needs to appraise at the price including the concession.
I think you are trying to use a concession. Only use concessions when absolutely necessary. Concessions are used to either 1. allow you to show more downpayment and borrow the closing cost. or 2. show the home as selling for more.
If you are asking the seller to pay your closing cost, You may be in for a tougher negotiation, because if I were the seller, I definately would not pay your escrow, or your title insurance or for that matter you homeowner's insurance.
All concessions must be on the initial offer, you cannot sneak them in anymore, and the home needs to appraise at the price including the concession.
Not sure I follow you. I've heard of people asking for the seller to pay part or all of the closing costs. I'm not talking about adding it to the asking price as a sellers assist.
I would reduce the offer. That will reduce the amount of interest you owe in the long run since you would be paying interest on 235k instead of 242k (obviously you would reduce both of those numbers equally by whatever amount you are putting down, but you see my point).
I purchased about a year ago. Condo was listed for $232k and I ended up getting it for $223k with $9000 in sellers concessions. I did not have to pay any closing costs as well as getting back money that I spent out of pocket for appraisals, home inspection as well as a special assessment that was due to the association.
They accepted because $224 was their bottom line and this was just a way for me to keep the additional $9000 in the bank and roll the cost into my mortgage. It made literally no differance in my monthly payment and I was able to have more of a cushion in the bank if any repairs needed to be done.
I purchased about a year ago. Condo was listed for $232k and I ended up getting it for $223k with $9000 in sellers concessions. I did not have to pay any closing costs as well as getting back money that I spent out of pocket for appraisals, home inspection as well as a special assessment that was due to the association.
They accepted because $224 was their bottom line and this was just a way for me to keep the additional $9000 in the bank and roll the cost into my mortgage. It made literally no differance in my monthly payment and I was able to have more of a cushion in the bank if any repairs needed to be done.
How did you decided to ask for the $9k? Is it a certain percentage of the listed price? I guess what I'm trying to say is how did you know the $9k would cover your costs.
By doing this you ended up buying the condo for $232k but getting back the $9k at closing?
The condo I'm looking at is listed for $242k, I'm thinking of offering $233,500 and asking for $8,500 in sellers assist. Does that make sense?
It really shouldn't make a difference to the seller. All they should be looking at is the net amount of money they will be getting. The only thing I can think of is if they would be concerned of the house appraising and therefore wanted a lower offer with no concessions.
There is a max percentage that you are able to ask for...you can ask your realtor because I am not sure how they calculated it. The purchase price was $232 and then they gave me the $9k at the closing to cover all of my costs. Your realtors should be able to figure out all the details.
Quote:
Originally Posted by crortega9
How did you decided to ask for the $9k? Is it a certain percentage of the listed price? I guess what I'm trying to say is how did you know the $9k would cover your costs.
By doing this you ended up buying the condo for $232k but getting back the $9k at closing?
The condo I'm looking at is listed for $242k, I'm thinking of offering $233,500 and asking for $8,500 in sellers assist. Does that make sense?
Hi guys, I'm looking at a condo with an asking price of $242k and would like to know if it would be better to offer full asking price and ask for the seller to pay the closing costs or offer something like say $235k and pay the closing costs myself? I may try to offer $235k with the seller paying some of the closing costs but I don't know if that will fly. Thank in advance!
Lower offer, pay your own bills. A "concession" requires the house to appraise for higher than the selling price. Can you say: "Not happening"? Not unless the house is truly and obviously worth more than you are paying.
Forget the concession, it has a very low probability of success. Appraisers get the contract and will be very leery about appraising the house higher than the cash equivalent price so that you can attempt to finance your closing costs.
Keep it simple. Lower your offer and cover your own costs. If the sellers do not accept, move on to another property. There is ALWAYS another property.
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