It is prudent and wise to prepare for many important steps in life, as the right preparation can increase your chances of success. When you are buying your first home, making preparations can similarly help you as you consider and plan how to pay for the closing costs and down payment in advance of the closing day. Here are some tips to help you afford the initial costs during the purchase process as you buy a home.
Ask for Seller Assistance
When you buy a home with financing, there are likely to be closing costs due at the closing meeting to sign and purchase your home. Closing costs can account for several thousand dollars, or 2 to 5 percent of your home's purchase amount, which pays for expenses related to the purchase transaction. One of the ways you can get some assistance is by asking the seller to help you pay for some of these at closing. Otherwise, you will need to bring the money to closing in the form of a cashier's check in order to finalize the purchase transaction.
To take advantage of this type of assistance, you need to write it into the initial purchase offer on the home for the seller to agree to it. When you are making the offer on the home to purchase it, ask your realtor to help you write into the contract a request for the seller to help you with part or all of these closing costs. The money that the seller gets from their home's capital gains can be used to pay for these expenses. Then, you only have to bring to the closing any required down payment for your loan financing.
Ask Your Agent for a Realtor Credit
A second way you can get financial assistance for the purchase and closing on your home is to ask for your real estate agent to help out. Your real estate agent gets a commission at closing to cover their time and effort, which is how they get paid. However, you can ask your realtor to rebate a portion of their commission to you as a closing cost credit or to put toward your down payment requirement at closing.
Asking your agent for some of their commission can help you lower the amount you have to bring to closing, but keep in mind not every agent may be willing to do this. Their commission is their paycheck, but it does not hurt to ask for them to help you out by giving you part of it. After all, without their assistance the sale may not take place, and they may not earn a commission at all if the sale does not go through.Share
19 July 2018
After I decided to buy a new home, I realized that I probably needed to prioritize the things on my wish list. Since I am not wealthy, I realized that I probably couldn't get everything that I wanted out of a single home--at least, not this time around. Fortunately, I worked with an incredible real estate agent who helped me to figure out which type of property would pay off in the end. Finding a home took a lot of time, but I am really pleased that I found the right one. This blog is all about learning to prioritize your home hunting wish list so that you can have the home and financial situation of your dreams.