Buyers' Agent Claims an "Appliance Allowance" is Illegal . .????

[Josh Woods]

I can give you a very good agent referral if you would like, please PM me.

[hiknapster]

Usually, if the title company is holding money in an escrow account for repairs it is due to approval by the mortgage company being contingent on certain repairs being done. There is usually a timeframe involved, too, such as "repairs on roof must begin in 48 hours."

This all comes back to what your mortgage broker's or bank's underwriter approves and has nothing to do with the real estate agent. However, once again, the buyer is more than welcome to put in an offer to purchase with any amount he is willing to pay and the agent must submit that offer.

And the OP dealt directly with Uncle Sam.

Originally Posted by Josh Woods

I am also a licensed TN Realtor and my understanding was that allowances at closing not acceptable. However, there are ways around everything:

1. Make the allowance part of your closing cost assistance. In most loans, closing cost assistance can be up to 6% of the purchase price, but usually 2.5-3.5%.

This way if you were already paying your closing cost, you will have the money in your pocket to complete your appliance purchase. This is a way around what you are trying to accomplish.

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I will say this. I have done two closings this year where the attorney/title company did allow money to be credited for repairs at closing. My most recent issue was where there was inadequate insulation in an attic (discovered at final walk-thru in July) when original purchase and sales date was March (cooler weather). The attorney allowed a $1,200.00 repair allowance for insulation and my broker and cooperating broker agreed.

[Vickie10essee]

Originally Posted by donald cherry

and dont forget the higher the price ,the more the realtor makes,,,,,,,,,,so if you take an allowance less for the realtor, poor realtor???

I just wanted to clear up a misconception that most people have, on behalf of my fellow realtors out there . While it is true that a realtor makes more money on a higher sales price, the amount they make is barely anything when we are talking about a few thousand dollars in concessions/allowances, etc. We don't make 3% or 6% of the sales price. We have to split that with our broker, pay our self-employment taxes, gas, supplies, and not to mention thousands per year for insurance, realtor membership, lock and key rental, and much more. On say, a $3k reduction in sales price, one realtor will take around $60 less, not including all of the taxes, expenses, etc. So really, realtors could care less about these lower/higher prices. I can't tell you how many times I have recommended that my buyer clients go up by $1000 or so during negotiations, when I can just "feel" this in them, that they think my motivation to do this is so that I make more money. It may make me $10 more dollars!!! I just want them to get the house they want. I have seen them look at me kind of funny (with distrust b/c I am a realtor I guess), and disagree, then lose the house of their dreams over $1000, or a dollar per month in payment (or whatever the calculation may be) because they didn't take my advice, that was meant to help them. After this happens once or twice though, they "get it" and start taking my advice. It is just the way it is though. I do understand that you can't trust people these days though.