Seller’s concession is a dollar amount or a percentage of the purchase price that a seller agrees to contribute to the buyer in order to help cover the buyer’s closing costs. This is helpful for home buyers who may not have the funds to cover closing costs, or who may want to avoid having extra money tied up in a mortgage.
An example may better clarify the concept of seller’s concession. Imagine that a buyer is purchasing a home for $100,000 and is eligible to receive seller’s concession of 6% of the purchasing price. This raises the sale price of the house to $106,000.
If the offer is accepted, the seller will still receive $100,000 for the property (known as “net to seller”) and the $6,000 extra in the loan amount will be used to help the buyer cover closing costs. In order to be able to use seller’s concession, the home must appraise for the new sale price of $106,000.
Seller’s concession amounts vary based on mortgage type. Maple Tree Funding and our wide variety of lenders offer numerous loan programs with varied seller’s concession percentages.
The team of experienced mortgage professionals at Maple Tree Funding can help you every step of the way when it comes to buying a home. Our knowledgable staff can help you fully understand seller’s concession and guide you through all the steps of the mortgage process.