Home Buying in 21234>Question Details

Cbensley_62, Home Owner in Parkville, MD

What is the average amount sellers are contributing to closing cost?

Asked by Cbensley_62, Parkville, MD Fri Apr 5, 2013

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Sellers are allowed to contribute up to about 6% depending on the mortgage down payment. Larger down mortgages allow a greater contribution. The type of mortgage will determine the maximum contribution. Many first time buyers, especially those with FHA loans need a little help and it usually runs from 1-3%. Increasing the price and increasing the incentive often doesn't work as a marketing strategy because the price begins to bump up against the appraisal which is the only value that the lender considers.. It is always better to say in the listing "Closing help available" and then work with the buyer's agent and the loan officer to pick the right number.

Bob McGee
Advance Realty Timonium
410-560-4574
1 vote Thank Flag Link Fri Apr 5, 2013
It depends on your offer how motivated the seller is and how many competing offers there are on the table. All things being equal usually around 3% average.
1 vote Thank Flag Link Fri Apr 5, 2013
3-5% of the list price on average
1 vote Thank Flag Link Fri Apr 5, 2013
Hello C,

Seller help can be limited to the loan program, loan to value and occupancy type the purchaser is using to purchase the home. Loan programs allow from 2% to 9% interested party contributions (IPCs). IPCs are costs tthat are normally the responsibility of the property purchaser that are paid directly or indirectly by someone else who has a financial interest in, or can influence the terms and sale or transfer of the subject property.

For more information on your specific purchase scenarion, you can reach me on my cell phone : 202 573-6035.

Catherine Purcell
Senior Mortgage Loan Officer
Fairway Independent Mortgage Corporation
0 votes Thank Flag Link Sat Apr 6, 2013
If you really need this information, then the exact average can be calculated for any given neighborhood based on data, which is available to real estate agents, from the Multiple Listing Service.

However, as has been suggested by many of the other responses, there are numerous factors which determine this number.

If you need closing help assistance, you might, also, consider programs which are available to provide this assistance other than the Seller.
0 votes Thank Flag Link Sat Apr 6, 2013
$300?

We don't keep data on this, but with multiple offers being the new normal, a lot of sellers don't have to take less than asking price - or asking price, but paying some of the buyer's closing costs - anymore.

What I'm seeing more commonly is that the price will be raised to include closing costs - the offer on a $300,000 property is $325,000 with the seller paying $5000 in closing costs. How that affects the "average" I'll leave to others.

Hope this helps,
0 votes Thank Flag Link Fri Apr 5, 2013
It's ALL NEGOTIABLE! 8-) You as the seller don't have to give anything. In today's market offering closing help motivates more buyers to write offers and ultimately close on your home's sale. FHA allows up to 6% in seller contributions; VA loans allow up to 4% and Conventional loans vary, some up to 3%, some less. Feel free to call me to discuss your needs if you're thinking of making a move. I live minutes away in Rosedale. I LOVE the Parkville Family Y. My boys and I go there all the time. You're minutes to White Marsh and Towson. Great central location for the East side of Baltimore County. If I can help further, CALL ME.

All Smiles,
Marlene Rogers
410-499-7279

** Loan program guidelines change all the time. There were talks that FHA was going to reduce the seller contribution to 3%. Whatever your plans, ACT NOW. You'd be surprised how quickly things change and out of your favor.**
0 votes Thank Flag Link Fri Apr 5, 2013
It varies depending depend what is negotiated. most buyers in the market are first time home buyers. Anticipate most buyers requesting about 3% closing assistance depending your asking listing price. The potential buyer could always request more or less.

good luck
0 votes Thank Flag Link Fri Apr 5, 2013
There really is no average and it depends on the type of financing you are using to purchase your home. If you are using FHA financing the maximum is 6%. With VA there is no real maximum but typically it is up to 6% and with Conventional it sometimes depends on the lending institution and the amount you are putting down. And, it depends on the competition, what other sellers in the area are offering and how creative your agent is at writing the contract.
0 votes Thank Flag Link Fri Apr 5, 2013
It depends on the zip code, individual seller motivation and initial list price in relation to that particular market. If you look at the MLS trends for the past year or so, some sellers have given 3% while some have not. I don't see too many contributions in the 6% range since many sellers will hope that they can find a buyer who doesn't need to give, say, $15,000 for a $250,000 house. In general, the max negotiated price drop (with a seller contribution) that I see is about 5%. If buyers are expecting 6%-10% of a price drop, they are statistically unlikely to get it, either because the sellers are not ready to go that low (perhaps due to ego involvement) and/or the market doesn't support a price that low.

Good luck no matter which side of the fence you are on!
0 votes Thank Flag Link Fri Apr 5, 2013
There is no fixed answer nut I see ranges from $2700 to $7000 in your area of Parkville. Stacy Brunner, Local Realty, Inc. 410-560-2525
0 votes Thank Flag Link Fri Apr 5, 2013
In Montgomery and parts of Frederick County sellers are paying "ZERO", towards closing costs. The market is to competitive.

Greg Myers
RE/MAX Realty Group
0 votes Thank Flag Link Fri Apr 5, 2013
The average amount that we are seeing on offers coming in are anywhere from 3 to 6%. If its a Short Sale or FHA, consult with your Facilitator on the exact amount allowed in the transaction.
0 votes Thank Flag Link Fri Apr 5, 2013
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