Bill Medlin

Great question. FHA will allow sellers' to pay up to 6% of buyers closing cost and prepaids (the escrow buildup account). You should be able to purchase a home thru FHA and all buyers' closing cost with prepaids paid by seller.
Now, to your question on "how much is added to my offer price." What the seller should be looking for is the net amount they will receive from the deal. The buyers' closing cost paid by the seller has to figure into this formula. Example: If the sellers' have to receive say $190,000 from the sale of their home, prior to their closing expenses, that means that with no buyers' closing cost paid by the seller, you could contract the home for $190,000. If you need $5000 of your closing cost paid by the seller, then the seller should be willing to accept a contract offer of $195,000. Now, you nitice I said " "should" ". I have seen sellers' that have a problem accepting the idea of them paying anything for the buyer, even though it helps sell their home and they net what they need. However, most sellers' will work with buyers'.
This is only one example of why it is important to work with a good Realtor. We can help explain these little details, and make sure both parties are happy with the outcome and protected throughout the process. - Fri Oct 17 2008, 07:04