r/FirstTimeHomeSeller • u/aa040371 • 3d ago
Should I consider a credit to Seller to help with loan/buying expenses?
I am selling my home in northeast Greater Dallas area (suburb). I have an offer but buyer, among other things, wants a several thousand dollar "credit" to help cover closing costs associated with loan and etc. My realtor says this is becoming more common and that, according to county data, roughly 60% of sellers are giving credits right now. Is this something I should even entertain?
Additionally, why not just offer less for the house to begin with?
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u/JerseyGirlinSweden 3d ago
This was common practice in many market as the tides turn. This helps them afford the home by helping roll in some of the costs to their loan, and reducing the amount they have to produce to close. I saw your comment elsewhere question commission. How big of a credit is this really? I doubt the effect on the commission is going to kill you.
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u/aa040371 3d ago
Yes, your point about the commission is well taken...that's really only a few-to-several hundred involved...not enough to make a real fuss about. I was reacting more out of principle than practical considerations.
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u/mortgageswithcynthia 3d ago
Because a lower price and less money needed at closing help the buyer in two different ways.
Say you drop the price by $5,000. That saves them a little on their monthly payment, but they still need the money for closing costs. A $5,000 credit toward those costs could mean $5,000 less they have to bring to closing, which lets them keep more of their savings for moving, repairs and emergencies.
For someone who’s comfortable with the monthly payment but needs help with the upfront expenses, that credit can be much more helpful. It isn’t better for every buyer, but that’s why they may ask for it instead of offering less. Your agent can compare what you’d actually walk away with under either offer, and their lender needs to confirm how much credit they can use.
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u/CheddarMoose 3d ago
I would look into a rate buy down for the buyer & see if that’s something you would offer in its place.
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u/aa040371 3d ago
Is there a specific advantage for the seller to do this?
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u/MontiBurns 3d ago
So we're looking at asking for rate buydowns, a 2-1 buy down lowers your mortgage by 2 points for year 1 and 1 point for year 2. The advantage being that you have a lowerorgage rate, which can help ease the initial up front costs you assume when buying a house. It also opens up the possibility to refinance in the next year or 2 with a lower interest rate.
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u/cdeussen 3d ago
I bought an expensive house, which meant closing costs were high but so was the maximum allowed contribution from the seller. We agreed on a final price of $950K. I wanted to minimize my out of pocket down payment at closing, so rolling closing costs in the loan was better. The seller could still contribute an additional $32K to closing legally, so we increased the sale price to $982K and seller contributed max to closing. The total price after all costs considered was the exact same net cost. Have their mortgage person figure the max contribution and increase the price keeping the same net price.
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u/aa040371 3d ago
Interesting analysis. But as a seller, doesn't increasing the price work against me since it then raise the commission amount to the buyer/seller agents?
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u/cdeussen 3d ago
No, mortgage person can work out the math, so it is the exact same net. This is why hiring a good realtor and picking a good mortgage broker make a difference despite what Reddit says. People that are good at their job do the extra work and have knowledge that can get you a better property and save you money.
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u/aa040371 3d ago
Thanks. The mortgage broker is more for the buyer-side process than mine...correct? I do I ask my agent to suggest a broker to other agent?
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u/cdeussen 3d ago
Yes, but you can have your realtor communicate this to the buyer as your preferred solution. The mortgage broker also wants this deal and makes good money, so let them put in a couple of extra hours. There’s nothing wrong with everyone doing a little work to earn their money. Not every sale is “happy path”.
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u/upsidedown-funnel 3d ago
Smart question. I don’t have the answer but I’m thinking I’d insist they only take commission off the lesser amount. (Currently selling)
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u/cdeussen 3d ago
Obviously, this is also an option. A done deal for the money you originally expected beats letting the sale slip by. My realtor was great and very knowledgeable. The biggest thing I learned is that the entire process is negotiable not just the sale price.
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u/MontiBurns 3d ago
Welcome to 2026. Houses are sitting longer, interest rates are higher, but prices still haven't come down.
How long has your house been on the market? Have you had a lot of showings or interest? If you're getting asking price with seller credit, that's pretty good these days.
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u/HallieLokey 3d ago
Prices are constantly being lowered in South Florida
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u/MontiBurns 3d ago
Prices are super stubborn in my market. They have come down a bit, but they still are much higher than even post pandemic levels.
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u/aa040371 3d ago edited 3d ago
Not long...listed <14 days ago, good open house attendance, prolly 10 showings. One solid offer, two nibbling at the hook (2nd visit, clear expressed interest.)
They also asked for several thousands off of listing price as well; between lower offer price and seller credits, roughly $25K total. That's about (6-7)% haircut :--(
I do get that it's a rough market out there, though.
edit: corrected "weeks" to "days".
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u/MontiBurns 3d ago edited 3d ago
14 weeks is a long time for a house to be sitting. My buyers real estate agent says that 5% below list price is pretty common these days, especially if a house has been on the market for 2 weekends.
Any interested buyers have already screened or viewed your house. You are waiting on new buyers to enter the market. Anyone interested would have offered you about what seller is offering after it's been sitting as long as it has.
If it's a typo and you meant 4 weeks, I think the logic still stands. If you were gonna get full asking, you would have gotten full asking. You can always counter with whatever so long as you net X amount on the sale (whether that's seller comps or lower sale price)
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u/Hayat_Moore 3d ago
This is very common in many markets now as the rates continue to increase. Using a $20,000 credit to buy down the rate will save nearly double the money monthly compared to a $20,000 price reduction. Which is why we recommend buyers request a credit over the lower priced offer.
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u/AdComfortable2974 3d ago
You mean credit to the buyer, not the seller.
You can offer whatever you want; get a seller net sheet from your agent so that you understand what you're going to walk away with. Could be baked into the list price.
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u/Steefanon 3d ago
The monthly payments aren't the problem; it's coming up with the cash at closing.
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u/Bunnies_2025 3d ago
We sold this year to first time home buyers and they needed seller credit for their rate buy down; specifically needed to be seller credit. They even offered to increase offer price as long as we did the seller credit.
Just depends! We sold in the same area, FYI. We were also worried about the seller credits, but they didn’t bother us with inspection repairs. In the end, we did just fine.
Good luck!
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u/SnooMacarons3689 3d ago
No
Raise the sale price in the contract to finance in their costs that’s what I did
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u/Tall-Description6708 2d ago
I've had to do this before, I was super close to a 20% down payment but needed some help with closing costs. I don't think it's a red flag. The sellers agreed and I've been here 8 years now so the loan did close lol
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3d ago
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u/aa040371 3d ago
Right...that was why I was wondering if I should have buyer ask for a lower offer price rather than a credit. Although another comment here indicated there is benefit to buyer to ask for credits instead.
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u/FitLoveLeo 3d ago
If you take time to do the math, you’ll see that a lower purchase price will generally do less for the monthly payment than offering credits will. Unless you take a much lower price, which might be the same as offering credits anyway.
For buyers that don’t have a down payment, or don’t have much of one, the closing costs can be the barrier to whether they can buy your home at all. A lower purchase price might lower the monthly payment $25 - $40 (this was my case), but if you need the cash upfront, the credits are a much better deal. Especially if buyers think they are just going to refinance at some point and lower their payment anyway.
I just purchased this year and we negotiated on seller credits. The seller changed the closing date from the end to the beginning of a month. I didn’t realize until I received the initial closing cost estimate that this resulted in my having to come to the closing table with basically one month of the rent I was paying, due to prepaid interest being due.
I cancelled because this would’ve meant I had to come up with more money than made me comfortable. You never know what’s going to come up when buying a new place as far as unexpected costs and moving is expensive anyway. In my case, I would’ve had to pay double my rent (the last month I was living there + prepaid interest on the purchase) for this one month. And my options to do that were unfavorable.
The seller responded with negotiation for additional seller credits, which covered the prepaid interest, thereby eliminating my cash flow issue. And I bought the home, even though I’d already accepted that I would stay in my apartment for maybe another year instead of buying at all this year.
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u/aa040371 3d ago
Wow...very creative on both of your parts. Congrats on new home!
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u/FitLoveLeo 3d ago
Thank you. I’m not sure what the seller needed to do to be creative. I ended up with most of the closing credits I asked for when I offered. And I needed them be able to buy the home. Otherwise, the deal was cancelled and the place could very well still be for sale now, a few months later.
Point being, seller came around with the help in order to sell the home, which is what I’m trying to explain to you, who is asking about these types of situations because you’re trying to sell your house.
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u/Substantial_Lie_9604 3d ago
Because they can roll it into the loan. Less out of pocket.