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What Are Seller Concessions?

Seller concessions, also known as seller contributions or seller credits, are a common feature in real estate transactions. They are arrangements made by the seller to cover some of the buyer's expenses associated with the purchase of their home. So how do seller concessions work and how do they benefit both the homebuyer and the seller?


Homebuyers shaking hands with seller on closing day

When a buyer is ready to purchase a home, there are various cost considerations involved, such as closing costs, lender fees, title insurance, appraisal costs, inspections, property taxes, and even home warranties. These costs can add up and may be a significant financial burden for the buyer. The seller can offer to cover a percentage of the purchase price, to alleviate some of these costs by essentially agreeing to reduce their net proceeds from the sale.


Seller concessions can benefit both buyers and sellers:

  • Buyers: Seller concessions can help buyers by reducing their upfront costs, making homeownership more affordable. It can be particularly helpful for first-time buyers who may have limited savings.

  • Sellers: Offering concessions can make a property more attractive to potential buyers, potentially leading to a quicker sale.

It's important to note that seller concessions are typically disclosed in the closing documents and are subject to lender approval. Additionally, the specifics of seller concessions can be influenced by local real estate customs and market conditions.


At Willow Bend Title Company we always advise our clients to work closely with their real estate agents and lenders to understand the implications of seller concessions in their specific transaction. This will insure that everything is ready and will go much more seamlessly when they meet us at our table (or theirs) on closing day.

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