Question Details

Rose, Real Estate Pro in Houston, TX

CLOSING COSTS

Asked by Rose, Houston, TX Fri Oct 17, 2008

IN AN FHA CONTRACT HOW CAN I ASK THE SELLER TO HELP ME WITH CLOSING? HOW MUCH IS IT ADDED TO MY OFFER PRICE THANKS!

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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.
0 votes Thank Flag Link Fri Oct 17, 2008
First of all you should be utilizing the services of a Realtor to help you in any real estate transaction. Your realtor should be in close contact with your lender to get an accurate closing cost number so that you will know what to expect. FHA guidelines will allow the seller to pay for closing costs and the buyer must have at least 3% of their own money into the transaction as a downpayment on the home. As a practice I ask for a specific amount of closing rather than a percentage. Your last question about how much is added to your offer price cannot be determined. There is a price the seller is willing to take for their home and determining this number is the more important question. Additional terms such as how much closing costs they will pay is another matter. A good offer should be reflective of what you need as a buyer to purchase a home and what the seller is willing to take.
0 votes Thank Flag Link Fri Oct 17, 2008
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