Home Buying in New York>Question Details

Tatiana, Home Buyer in New York, NY

Is it typical to ask the seller to help with closing costs in NYC?

Asked by Tatiana, New York, NY Fri Jan 3, 2014

I understand that the market in NYC is different partially because it's so competitive. Is it strange to ask the seller to help with closing costs? Seems like that's the norm pretty much everywhere else. Thanks!

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Answers

16
Keep in mind that in competitive markets asking the seller for help with closing costs may not result in a deal; therefore shop properties within your budget.....
2 votes Thank Flag Link Fri Jan 3, 2014
Hi Tatiana,

Asking a seller to help with closing costs is not typical but is not impossible if you have a very motivated seller.

However, it could also make you look like a buyer who is not serious or someone who is not well seeded financially. Additionally review the closing costs. Are they so steep that you cannot afford them? Think about it carefully before you ask.

If the seller declines, don't let that stand in the way of buying your dream home.

Hope that helps!

Ross Ellis I Licensed Real Estate Salesperson
Halstead Property, LLC
212.317.7828 direct
rellis@halstead.com
1 vote Thank Flag Link Fri Jan 3, 2014
Hi Tatiana,

It's NOT common in NYC, yet there are some rate instances where that type of deal structure may make sense.
1 vote Thank Flag Link Fri Jan 3, 2014
Tatiana, you're correct. In any market where many of the transactions are those where buyers are paying all cash, or coming up with high down payments (25% or more) and paying their own closing costs, it's always going to be difficult for you to get a seller concession. In these markets, you're going to be viewed as a weak buyer. Not all of NYC is like this, but some parts are. In other parts of NYC, seller concession is the norm and more acceptable. I guess it really depends where you're looking to buy?

If my response was helpful, consider clicking BEST ANSWER!

Javier Meneses
Senior Loan Officer
NMLS #23130
STERLING NATIONAL BANK
310 Crossways Park Drive
Woodbury, NY 11797
jmeneses@snb.com
(516) 606-9648 Cell
(516) 740-4478 Office
(516) 918-5383 Fax
1 vote Thank Flag Link Fri Jan 3, 2014
The NYC market is extremely competitive at the moment. Many buyers are purchasing multi-million dollar homes all cash, foreign buyers especially. Some are even over-paying!! It puts you at an major disadvantage.

Why don't you explore potentially having the lender issue you a lender credit that will pay for all or a portion of your closing costs?

We do it all the time over here at Guaranteed Rate with borrowers who either need a sellers concession or have the down payment but are short funds to close.

A WIN-WIN every time :-)

Hope this helps!!
0 votes Thank Flag Link Mon Nov 24, 2014
Homeowners aren't usually asked to help with closing costs, unless there are unique circumstances that pertain to the transaction. You certainly don't want to get a homeowner annoyed by asking them to do so unless they state otherwise. If you are looking purchase a home, make sure you go over all of your expenses carefully. The last thing you want to do is purchase a home and then realize your budget doesn't leave you enough for possible repairs and the daily costs of living.
I wish you the best of luck.
0 votes Thank Flag Link Mon Nov 24, 2014
NYC is a competitive market so seller have no incentive to pay a buyer's closing cost. Such assistance is more likely in a buyer's market where homes remain on the market for a long time.
0 votes Thank Flag Link Sat Nov 22, 2014
With a hot market in NYC this is unlikely. Sellers helping with closing cost occurs in a buyers market where homes remain on the market for a long time.
0 votes Thank Flag Link Sat Nov 22, 2014
New York City. It is a singular market. Like no other place at all. As others have siad, it is not typical. Current market condition may preclude asking that question but you certainly can. The larger problem is the NYC market is extremely brisk, Inventory is at an all time low and now that the so-called "Fed" will be slowing it "Quantitative easing," interest rate will rise, This will create the perfect storm for those buyers looking to get in before rates rise. A quality apartment may have multiple offers for the sellers to pick and choose from. Most likely you will pay full asking price without a sellers concession or your offer will be bested by another.

If you are prepared to move forward, I suggest you don't let a few thousand dollars stop you. Good luck.
0 votes Thank Flag Link Fri Jan 3, 2014
I will add this. Saying that seller concession "NEVER" happens in NYC is just not a factual statement. Sure it happens, BUT not often enough. As you can see, most of the Realtors responding are from the NYC marketplace and their statements is a reflection of what they see in the market.

The most likely scenario for you is that if you ask for seller concession, you'll have to increase your initial offer to absorb that seller concession. At the end of the day you'll be paying for it anyway. This will however cost you the opportunity at some properties you want to pursue, because asking for seller concession classifies you as a weak buyer. So if you have the money available, and you don't want to miss out on some or many of the properties out there, consider paying your own closing costs.

Again, this all depends on what part or market within NYC you're shopping. In some places seller concession is more than a norm, it's actually something everyone expects, and then you have the total opposite in other areas. Manhattan and many parts of Brooklyn, you can pretty much eliminate the likely good of this being accepted.

If my response was helpful, consider clicking BEST ANSWER!

Javier Meneses
Senior Loan Officer
NMLS #23130
STERLING NATIONAL BANK
310 Crossways Park Drive
Woodbury, NY 11797
jmeneses@snb.com
(516) 606-9648 Cell
(516) 740-4478 Office
(516) 918-5383 Fax
0 votes Thank Flag Link Fri Jan 3, 2014
Hi Tatiana,

Like the previous answers, it is unlikely to ask the seller to cover closing costs at this market.

I say this market, because it's a seller's market right now. 3 years ago, it was a different case. I encountered a situation where the seller was offerring to cover part my closing costs and this was already at an offer price 20k below asking. This was when I purchased a condo in a new development in Williamsburg. I believe it was an incentive offered solely to the first few buyers. I was the first to make an offer in the new development. I believe it helped them in getting more buyers in.

It's good to see comparables and see how the situation is. Developers are more likely to offer incentives than individual owners.

Hope this helps. If you have any questions, please feel free to contact me directly.

Karen Cheung
917.334.9544
kcheung@citihabitats.com
0 votes Thank Flag Link Fri Jan 3, 2014
A cash buyer is unlikely to ask for the seller to pay closing costs! The likely scenario is for a financed purchase where the buyer wants to hold on to cash and "wraps" the closing costs into the mortgage. If the buyer is willing to pay $200K for the property s/he makes the offer $205K with seller paying $5K to closing costs. Most lenders have no problem with this but (obviously) the property needs to appraise at $205K. This scenario is most likely in the lower priced markets. Some sellers may see it as a weaker offer and it may not be successful in a multi-offer situation.
0 votes Thank Flag Link Fri Jan 3, 2014
Hi, it isn't common in NYC and not even that much in Westchester. Every seller is different but in places where there is a lot of competition you chances are less likely.

Christopher Pagli
Accredited Buyer Representative
Real Estate Associate Broker
William Raveis Legends Realty Group
914 406 9023
0 votes Thank Flag Link Fri Jan 3, 2014
Yes Tatiana, it is the norm in many other states but not in New York. I've never seen or heard of a seller paying closing costs and I'm a very active agent also. Even a seller'a concession is undersirable right now in a competitive market where inventory is low.
0 votes Thank Flag Link Fri Jan 3, 2014
Hi Tatiana,

In 29 years covering thousands of transactions, I have never encountered a seller helping pay the buyer's closing costs in NYC. Every locality has their own customary practices. Seller closing cost assistance is not something that had ever occurred here even though it does in other places.
0 votes Thank Flag Link Fri Jan 3, 2014
Asking for the seller to pay for closing costs might be common or not but the bottom line is is just the same as lowering the offer amount. Most sellers will look at a $200,000 offer with seller paying $5000 in CC as an offer of $195,000. Most sellers could care less if they pay them or not as long as you buy the house and they net what they feel is fair. Around here CC are very uncommon because they seem to represent a weaker offer coming from a buyer that has no cash reserves to draw from. If there are two equal offers, 1 having CC paid, the seller will favor the other one.
0 votes Thank Flag Link Fri Jan 3, 2014
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