Home Buying in Natomas Creek>Question Details

Nml, Home Buyer in Sacramento, CA

I have a realtor helping me with my home purchase..I am a first time home buyer..I found a home which is

Asked by Nml, Sacramento, CA Fri Jul 11, 2008

selling for $174,000 my realtor is telling me that to put a offer in on the home she will be requesting 6%. I am not sure what this percentage means as she did not really explain this well. Will the purchase price go up 6% or is this going to be what she gets out of the sale? I qualified for the FHA program.

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Nmi,
Since you have a Realtor, it's important for you to have your Realtor explain exactly what the 6% is for. Anything else is just mere speculation on our part so you need to have her explain exactly what this money is for. My guess is that it is going toward your closing costs and down.

Congratulations on being an "almost homeowner!"

Gena Riede, Broker
Remax Gold
1 vote Thank Flag Link Fri Jul 11, 2008
Specifiaccly ask her to explain te 6%....as the agents below have poited out, it could be a number of things. I would be surprised if she was referring to the commission since this is between brokers.
Web Reference: http://www.cindihagley.com
1 vote Thank Flag Link Fri Jul 11, 2008
Cindi Hagley,…, Real Estate Pro in San Ramon, CA
MVP'08
Contact
Perhaps it is a for sale by owner. I have no idea. Some agents, when dealing with a FSBO, add the commission to the sales price. Did she ask you to sign a buyer broker agreement that stipulates she will get 6%? That's a bit higher than the traditional fees paid to buyer brokers.

Are you using Nehemiah in conjunction with FHA? That program will pay about 3% (*2.85% actually) for your down payment, and then there is 1.5% MIP added to your loan, and Nehemiah also pays 3% of your closing costs, when you use the program with FHA.

How did your agent explain this to you? Did she give you any documentation?
1 vote Thank Flag Link Fri Jul 11, 2008
I believe per FHA guidelines, that is what the maximum closing costs you can ask from the seller. Asking that high of a closing cost can be very challenging now a days since the inventory is low and the demand is high. The competition is very tough.

Ask her if what is the 6% your Realtor is talking about.

Good luck!

Zeny Winn
Realtor#01716580
0 votes Thank Flag Link Sun Mar 31, 2013
Who is requesting the 6% from whom? It sounds as if you are talking about the Nehemiah program. Just a guess...In this program the seller is asked to pay the FHA 3% down payment and up to 3% closing costs. Anyway, good luck...I'm sure your agent will be able to clear this up for you.
Web Reference: http://www.mcglade.com
0 votes Thank Flag Link Sun Jul 13, 2008
Hi Nmi:

Definitely have your agent clarify that to you. My best guess is she is talking about the Nehemiah program mentioned below and not the commission. But that is only a guess. .

Commission is set by the seller (could be homeowner or trust or the lenders now a days) beforehand, so agent don't ask for commission. However, I have recently seen one agent who asked to have her commission increased in a purchase contract, which I thought was odd, because the commission was reasonable and you don't negotiate commisson in a purchase contract as there is no bearing on what the buyer is getting.

It is very important that you have a relationship with your agent that's open and that you feel comfortable to ask any question about buying a home or anything on the contract. She should be willing to spend the time to explain that to you until you understand what you are doing. Being a first time homeowner in this market or any market needs a lot of hand holding. That's how we earn our business and our worth to our clients.

Make sure you ask her to clarify.

Sylvia
0 votes Thank Flag Link Sun Jul 13, 2008
Sylvia Barry,…, Real Estate Pro in Marin County, CA
MVP'08
Contact
Nmi,
Need to clarify my previous answer with you. Although there was a time that 6% would have been a "red flag," there are certain instances where this amount would certainly be acceptable. Buying down points and closing costs are examples of what this might be used for however, it is extremely important that you clarify what the 6% is being used for with your agent and your Lender.

Just ask them the question and I'm sure that they will be more than willing to let you know. Communication between you, the agent and the Lender are vital for a smooth transaction.
0 votes Thank Flag Link Sun Jul 13, 2008
Nml,

Confront your agent with this question. He/she needs to know they need to be clear when dealing with "first time buyers."

If you don't clairify your need for comprehend the process, it more then likely will happen again.
0 votes Thank Flag Link Sun Jul 13, 2008
6% is most likely for loan closing costs - if I aint wrong, FHA allows for 6% seller credit to buyer but NOT for downpayment. Please Please review your purchase contract and since you have a REALTOR, please have him or her explain to you exactly what this is for.
Web Reference: http://www.UsaHouseBuy.com
0 votes Thank Flag Link Sat Jul 12, 2008
Hi Nml,

Is this the American Dream program whereby the seller 6% towards the purchase of your property? Please clarify with the agent. If this is a foreclosure the commission for your agent is already set by the bank. So I am pretty sure that the 6% is for you to assist you for the mortgage.
All the best,
Laarni
0 votes Thank Flag Link Fri Jul 11, 2008
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