How much of a discount can you get on a short sale?
Short sales are usually priced at 17% (on average) lower than what the market dictates. Your client’s first offer is more likely to be accepted if it is no more than 10 percent or so lower than the approved sale price.
Are seller concessions based on sales price?
Seller Concession Limits By Loan Type The restrictions on seller concessions vary by loan type. The lesser of the sale price or the appraised value usually dictates how much your seller can pay in concessions.
Do short sales go for asking price?
If the short sale house is on the MLS, it will be listed with the seller’s asking price. Typically, this price will be at varying levels below the market value. How low the price is depends on how long it’s been on the market and how many offers it’s received.
What are typical seller concessions?
Seller concessions on an FHA loan or USDA loan are limited to up to 6% of the loan amount. For Fannie Mae or Freddie Mac conventional loans, the limit is based on your down payment. If you put down 10% or less, the limit is 3%. For down payments above 10% but below 25%, the limit is 6%.
What do you need to know about seller concessions?
Also known as seller contributions, seller concessions are the costs that a seller agrees to pay on behalf of the buyer during the sale of a home, at closing. Sellers concessions can cover closing costs including but not limited to: Lender origination fees. Discount points. Title insurance costs.
What kind of concessions can you get on a FHA short sale?
While some private investors have unpredictable guidelines, most lenders (generally those with VA, Fannie Mae or Freddie Mac backed loans) in a short sale will allow up to 3% seller concessions to be paid towards the buyers closing costs. FHA allows 1% – but only to buyers with FHA loans.
Can a seller pay for closing costs on a short sale?
Often, buyers will ask a seller to pay their closing costs. If the buyer doesn’t have enough money to pay for closing costs and the bank refuses to allow the concession, the buyer might not be able to buy that short sale .
Where does the money from a short sale come from?
The seller does not pay these funds to the buyer directly. They come out of the proceeds of the sale like most other seller closing costs in a short sale .
