There’s a common practice in our market of home sellers paying for their buyers’ closing costs. Here’s why.
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Is it necessary for home sellers to pay the closing costs of buyers? In our market, we see a lot of VA and USDA loans where the buyer has 100% financing and asks the seller to pay their closing costs. This is very common in our market and occurs in about 90% of transactions.
In other markets like Denver, you can’t even buy a home for under $300,000. The reason why buyers are asking sellers to pay their closing costs here is that they don’t have the money to go the conventional route. After having to bring 3% or 3.5% down to closing, they’re also having to pay private mortgage insurance. They just don’t have the money to pay those closing costs in many cases.
Most of the time, these buyers just don’t have the money to pay closing costs.
When you’re setting your price, keep in mind that you might have to pay some buyer closing costs if you’re listed under $300,000 and the refusal to do so might lead to your home sitting on the market for longer than you’d like.
If you have any other questions for me, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.