Selling our home and the buyer is FHA... agent says we're required to pay 3.5%.

Asked by Lisa.deeben, Leesburg, VA Fri Oct 12, 2012

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Annette Levi…, , New York, NY
Mon Oct 15, 2012
3.5% is the minimum down payment on a FHA mortgage. The seller is allowed to pay up to 6% of the purchase price towards non recurring closing costs. You do not have to pay anything towards the buyers' closing costs. That is all negotiable with the purchase price.
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Glenda Cherry, Agent, Herndon, VA
Sat Oct 13, 2012
There's not enough information here to provide you with a useful answer. Whose agent? Yours or the buyers'?. What is the 3.5% for? Agent commission, closing costs or something else?
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allan erps,A…, Agent, Pearl River, NY
Fri Oct 12, 2012
Buyer is required to put 3.5% down. Have no idea what your fee would be other than what you agreed to pay to your Broker if listed.
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Vivianne Rut…, , Fairfax County, VA
Fri Oct 12, 2012
Are you selling your home on your own as FSBO or through a broker?
And if through a broker, is the broker a Full Service Broker or a Limited Service Broker?

I cannot even imagine an agent affiliated with a Full Service Broker telling you that Seller MUST pay downpayment for FHA loan buyers or even this one particular buyer that put an offer on your home - IF it was true, it would be an entirely another can of worms, wouldn't it?

If your home is listed with a Limited Service Broker, well, as the saying goes: "you get what you pay for."

If you are selling as FSBO, are you sure the Buyer Agent did not mean that you, the Seller, need to pay 3.5% professional fee to the Selling Broker representing the Buyer?

Could you clarify the 3.5%?
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Matt Elliott, Agent, Reston, VA
Fri Oct 12, 2012
Hi Lisa - agent may be confused or mis-communication there it seems. FHA allows buyers to buy the house with a minimum of 3.5% down payment, not including the closing costs. But, there is no requirement whatsoever for you as the seller to pay anything on behalf of the buyer, UNLESS, of course, you all agree to do so contractually.

Many FHA buyers ONLY have the 3.5% in savings to put towards the required down payment; and if this is the case, then the buyer will need some closing cost assistance or help from you as the seller. And if you are unwilling to pay some money towards their closing costs, then that decision may impact truly whether or not that buyer can purchase your home. Again, they need the down payment of at least 3.5% plus typical closing costs for a purchaser is 2.5%, give or take. So, your agent may be trying to communicate this to you.

It's all negotiated, and your agent should be negotiating hard for you, while also making certain he/she is following your desire to get your house sold.

Hope this helps; feel free to email/call if I can give any 2nd opinion, behind that of your agent.

Matt Elliott
Keller Williams Realty
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Christopher…, Agent, Tarrytown, NY
Fri Oct 12, 2012
Hi, There isn't any requirement for the seller to pay 3.5%. Te buyer is allowed to put down a minimum of 3.5% as a downpayment and may finance up to 6% of the purchase price for closing costs. Even as a sellers concession the seller doeasn't pay it, it goes into the buyers mortgage.

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Misty Mount, Agent, Yorktown, VA
Fri Oct 12, 2012
Are you selling the home without an agent? I cannot imagine your agent telling you you're "required" to pay anything except a commission per the terms of your listing agreement. Your comment doesn't say what the 3.5% is for.

You are not "required" to pay any closing costs without a negotiation that all parties agree to.
You definantly do not pay the buyer's downpayment, which only leaves the commission.

If you're selling on your own, be careful.
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Shanna Rogers, Agent, Murrieta, CA
Fri Oct 12, 2012
Hi Lisa,

If your Realtor says your are required to pay 3.5% of the buyer closing costs, they're wrong. You're not required to pay any of the buyer closing costs - you can if you want to but you don't have to.

Shanna Rogers
SR Realty
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Keith & Kins…, Agent, Verona, WI
Fri Oct 12, 2012
3.5% is the minimum down-payment required by the buyer for an FHA loan. You as the seller aren't required to pay anything in regards to FHA unless you agree to it in your contract with the buyer.
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Lisa Moroniak, Agent, Ashburn, VA
Fri Oct 12, 2012
There is no "required" number for a seller to pay a buyers' closing costs, regardless of financing type.

You can elect to pay $0 if the buyers agree to it. As with virtually any part of a real estate negotiation - price, terms and conditions are what's agreed on between the parties to the contract.

Lisa Moroniak | REALTOR® | Service360°
SFR - Short Sale & Foreclosure Certified
Keller Williams Realty
Phone: 703-635-0388
Licensed in VA
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Jessica Tracy, Agent, North Windham, CT
Fri Oct 12, 2012
FHA allows you to assist the buyer with up 3.5% of their closing costs. You are not require to assist with their closing cost if you do not want to. Counter back.
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