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Old 11-02-2012, 04:55 PM
 
371 posts, read 1,358,530 times
Reputation: 215

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I am on the verge of buying a house. As per seller's agent, the seller is already losing money on it at the current listing price, so she doesn't have much wiggle room to bargain and also doesn't want to pay the buyers closing costs (or part of them - which were estimated by buyer's agent at about 10K).

I'm wondering if this is just part of the poker game (we did look up the history of the house and it's priced at about 25K lower than she bought it for a few years ago). I'm also wondering who GENERALLY tends to pay the closing costs - buyer or seller? What is common or standard? (I know there are plenty of exceptions)? My buyer's agent is overall good, but seems to not want to "bias" me too much, so he's just saying things like "it's already well priced" and "here's the information I was given by the seller's agent" ... but when I ask, "Do you think it would be reasonable to offer 10K under listing price OR to offer listing price, but have them cover closing costs", his answer is that it's up to me. Duh! Of course it is ... but I need guidance!

If you've been at this juncture, all words of wisdom welcomed!
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Old 11-02-2012, 04:57 PM
 
107 posts, read 338,227 times
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10K for closing cost?? wow! Anyways, from what I've heard lately, the seller is paying most of the closing cost. It's still a buyer's market.
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Old 11-02-2012, 05:13 PM
 
371 posts, read 1,358,530 times
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Yeah, that's what I said "wow!" That number seemed to include home insurance for the first year as well as county and city taxes pro-rated - not sure if it should still be that high (house is 400k, btw). Does that still strike you as high? I don't know what's normal.
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Old 11-02-2012, 05:18 PM
 
107 posts, read 338,227 times
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You should ask the person working on your loan. Ask for a closing cost worksheet, that will give you an estimate.
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Old 11-02-2012, 05:32 PM
 
Location: Mostly in my head
19,855 posts, read 65,627,090 times
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It has only been in the last 5-7 yrs that I heard of sellers paying buyers' closing costs - blame HGTV. It also came about when loose mortgages allowed people to buy more house than they could afford; they couldn't come up with closing $$ on such expensive houses.

Your agent sounds kind of inexperienced.

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Old 11-02-2012, 06:05 PM
 
61 posts, read 150,886 times
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Seller contributions are normal in some areas, not so much in others. I think you should look at what you want to pay for the home. How much do you want to pay? Is it listed high, low, average? If it's below market, then asking for closing costs doesn't make alot of sense. If it's high, then either negotiate sales price or include closing costs. The seller's motives are less important than what you need and are willing to pay.
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Old 11-02-2012, 06:34 PM
 
Location: NJ
17,574 posts, read 46,008,278 times
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Assuming there are no appraisal issues, all the seller should care about is the net amount they will get. If their bottom line is 400K, it shouldn't matter if that is a straight 400K offer with no closing costs or 410K and paying 10K of closing costs. The check they get will look the same.
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Old 11-02-2012, 07:00 PM
 
Location: Needham, MA
8,527 posts, read 13,923,140 times
Reputation: 7908
Quote:
Originally Posted by Minier View Post
I am on the verge of buying a house. As per seller's agent, the seller is already losing money on it at the current listing price, so she doesn't have much wiggle room to bargain and also doesn't want to pay the buyers closing costs (or part of them - which were estimated by buyer's agent at about 10K).

I'm wondering if this is just part of the poker game (we did look up the history of the house and it's priced at about 25K lower than she bought it for a few years ago). I'm also wondering who GENERALLY tends to pay the closing costs - buyer or seller? What is common or standard? (I know there are plenty of exceptions)? My buyer's agent is overall good, but seems to not want to "bias" me too much, so he's just saying things like "it's already well priced" and "here's the information I was given by the seller's agent" ... but when I ask, "Do you think it would be reasonable to offer 10K under listing price OR to offer listing price, but have them cover closing costs", his answer is that it's up to me. Duh! Of course it is ... but I need guidance!

If you've been at this juncture, all words of wisdom welcomed!
Quote:
Originally Posted by manderly6 View Post
Assuming there are no appraisal issues, all the seller should care about is the net amount they will get. If their bottom line is 400K, it shouldn't matter if that is a straight 400K offer with no closing costs or 410K and paying 10K of closing costs. The check they get will look the same.
I agree with Manderly. The reason your agent said "it's up to you" is because to the seller an offer of $10K under asking or an offer of full price plus $10K in closing costs is the same. In both situations the seller nets the same amount. So, one is not going to be more attractive to them than the other unless there are tax implications for the seller.

In the end, this decision really is up to you.
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Old 11-02-2012, 07:10 PM
 
371 posts, read 1,358,530 times
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I guess my concern is that it appears the seller wants both ... full listing price AND no closing costs (to pay for buyer). Obviously, she wants both. Duh! LOL. And I want to win the lotto. What I want is to go either under 10K on the offer or have her pay closing costs. So, yes, what I would offer would even out, whereas, it appears that what she is expecting takes us 10K over the listing price when it's all said and done. Either way, I'll make a decision on how I want to go - but I'm obsessing about it. I don't want 10K to lose me the house, but having said that, 10K isn't chump change either!

So I was at least wondering what was standard. If it is standard for a seller to pay closing costs, then I won't feel as pressured into giving into that. I would find it reasonable to just make an offer at the listing price with a "standard" request that she cover closing costs. But if it's not something that's standard, then I'd rather negotiate in the other direction (by offering a bit under listing price). Yes, I'm obsessing!
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Old 11-02-2012, 07:19 PM
 
Location: Austin
7,244 posts, read 21,719,739 times
Reputation: 10013
Sellers NEVER pay closing costs. The buyer finances the closing costs into their loan which in turn increases the sales price they could have bought the house for.
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