Home Selling in Kensington>Question Details

Bonnie, Home Seller in Pennsylvania

How prevelent across the state of PA is it for buyers to ask / demand the full 6% of seller assist?

Asked by Bonnie, Pennsylvania Fri Dec 10, 2010

I am noticing in the region of PA where I am marketing my home that all of the buyers who are being presented to me want / need / demand / ask for the full 6% in seller assist. Are realtors across the state of PA finding that the majority of buyers want and really need the full 6% of seller assist or is the concept of getting seller assist being abused.

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it's a buyer market right now and there taking full advantage of it is at your discreaton rather or not you want to give seller assit it make's .The property a more a attractive by for homebuyer's who are looking for a deal but the new FHA rules that will be finalized coming in the new year will only allow 3% seller assit that 's why everyone capitalizing on the 6%
1 vote Thank Flag Link Sat Dec 11, 2010
Bonnie
Several great points have already been made. I would also like to add that even when a person doing an FHA loan can come up with all the money necessary I have recommended asking for the assist anyway. When the buyer will have little money remaing after the sale, it is a scary thing. That money left in the savings or even checking account can make a world of difference when something unexpected breaks and it will. Buying a home is a great step toward financial security. One step I feel is just important is a 3 to 6 month emergency fund. By putting that 5-6 percent into an emergency fund will make the clients home purchase a better and safer investment.
Benny Smith
3 votes Thank Flag Link Sat Dec 11, 2010
These days many buyers do not have enough money saved for down payment and closing costs. You should go by the net amount that you receive like the others have explained. If they offer more than what it is worth in oder to get the seller assist , the house may not appraise .Ask your agent to explain how it works.
Web Reference: http://www.gitabantwal.com
1 vote Thank Flag Link Fri Apr 8, 2011
Bonnie
Sellers assists are used typically when they are needed and not when they are just wanted. In my experience, a lot of buyers need some sort of sellers assist, but I always tell them that they are not getting free money from the seller. It is mortgaged and will affect their bottom line payment every month. My buyers who don't need a sellers assist don't ask for one. But my buyers who do need it, always ask for it and as long as the seller gets the price they want in net sale (what amount actually goes to them) then its usually granted.

Good Luck selling your home.

Carmel Archdekin
Coldwell Banker Preferred
223-225 Market Street
Philadelphia, PA 19106
215.680.5998
1 vote Thank Flag Link Mon Jan 17, 2011
It's pretty common for those without much funds to ask for "up to" 6% in closing cost assistance in FHA loan scenarios. If the closing costs add up to 5%, then that's all that would be allowed by the FHA.

If buyers want a house and can't come up with 20% down for a conventional loan, then they need to get an FHA loan for the most part. But there are those who want to get into a home yet only have a few % available. Just enough to get the loan yet nothing else to pay for closing costs. And getting seller's assistance to help cover the closing costs can make the difference of staying in a rental for another couple of years or living the American dream.
1 vote Thank Flag Link Fri Dec 10, 2010
Hi Bonnie...
This is a good question. Yes, buyers really need the full seller's assist to close in the majority of situations. Sometimes it is even one of the conditions of the loan. Seller's are responding by tacking the amount of the seller's assist to the negiotiated or asking price in order for the deal to move forward. Let me know if i could assist further.
Tamara
Keller Williams Realty
215-919-1101
1 vote Thank Flag Link Fri Dec 10, 2010
6% is not allowed for Conforming loans. 6% is allowed for FHA. Many 1st time home buyers do not have the required funds for down payemtn and closing costs -- thus asking for the assist. Look at the NET # you walk with. Talk to your realtor and focus there rather than the amount of Assist.

Maura
1 vote Thank Flag Link Fri Dec 10, 2010
THREE YEARS OLD!!!
Still relevant?
0 votes Thank Flag Link Wed Jun 19, 2013
In this current market FHA loans are common place because of the low down payment requirement, lesser credit approval compounded by 6 percent seller assist. Your agent can negotiate the price to absorb the assist to actually net you somewhere close to a deal w/o assist.
0 votes Thank Flag Link Wed Jun 19, 2013
it is closely linked to cash available and price point.. in certain parts of philadelphia its 50%, in others it is zero. In many loan programs the maximum about in seller assist is 3%. When homes qualify for FHA is when 6% is more common. It helps to bu down rate and cover closing costs.
We recently did a deal and offered more than the asking price with a 6% assist. Its all a negotiation.

Bruce Lang
Coldwell Banker Realty Corp
215 735 0700
0 votes Thank Flag Link Sun Jan 30, 2011
In our area well over 50% of the deals we see ask for the full 6%. If we look at any seller assist, say 1-5%, I'd say that at least 75% of our residential deals have some sort of seller assist involved.
0 votes Thank Flag Link Fri Jan 28, 2011
Bonnie,

The sellers assist is becoming more prevalent in today’s market. It seems to be very popular with a lot of my first-time home buyers. It helps people with good jobs and a steady income to buy a house without a ton of money saved up. I refer to these people as "job rich, cash poor." This is just a quick way of describing someone with a good new job but not a lot of money in the savings account. Remember, the percentage is always negotiable if approved by the lender just like the sales price!

Zach Skidmore
http://www.centercityhomes.com
0 votes Thank Flag Link Thu Jan 27, 2011
Concentrate on your NET to you, what you put in your pocket.
0 votes Thank Flag Link Sat Dec 11, 2010
Hello, Bonnie,

To Assist or NOT Assist...that is the question...but at the end of the day, what does it matter to you? If you get the $$ you want...your bottom line; and you only pay commission and transfer tax on your actual net, what you add on for the buyer shouldn't matter. You wouldn't have had that money anyway.

When explained properly, the seller assist can be a win-win for everyone. If you would like to chat about it, just let me know.

Good luck with all,

Carol Cei
ReMax Action Realty
215-643-9661
carol@carolcei.com
Web Reference: http://www.carolcei.com
0 votes Thank Flag Link Sat Dec 11, 2010
SImiliar to the answers below, seller assistance is becoming more popular due to more buyers being approved for FHA financing. You mentioned that you were marketing your home, so I'm assuming you are a for sale by owner. What I suggest is that you familiarize yourself with the costs involved in selling your home. In Phildelphia, there is a 4% transfer tax. The seller is charged 2 % and the buyer is charged 2%. This will decrease your net at the closing table. I would be help to assist you with any additional questions or concerns.

good luck-
Ruth DiRienzo Whitehead
Keller Williams Real Estate
ruthdw@kw.com
C:215-280-3949
O:215-657-8100
0 votes Thank Flag Link Fri Dec 10, 2010
A seller's assist is a negotiable item just like any other term in an offer. Negotiations do not have to be a zero sum game, even in today's environment. Ask your Realtor for advice and proceed accordingly.
Web Reference: http://PhillyandBeyond.com
0 votes Thank Flag Link Fri Dec 10, 2010
It is common in this market but meet them in the middle or as long as it is at asking price or under have them put in a higher offer in to cover the assist. In addition a place like Kensington with lower taxes may result in closing costs closer to 5% vs the full 6% FHA allow for. Get in touch and I'll run a buyers closing cost report for you property.

Best,

Carl Caldas
CITYSPACE
2200 Walnut St.
Phila, PA 19103
c. 215-279-1897
ccaldas@phillycityspace.com
0 votes Thank Flag Link Fri Dec 10, 2010
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