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The costs of buying a home may be daunting. For example, you may have finally saved enough for a down payment on your first home, with a little left over to buy the furniture you will need. Then you hear about having to pay closing costs you weren't anticipating, and this may seem like a real setback.

One way to cover such a shortage is to make the sellers an offer that calls for them to credit you for some of the closing costs. As a rule, the sellers may pay a maximum of 3 percent of the sales price if the buyer is putting five percent down. If the buyer is making a down payment of 10 percent or more, the seller can contribute up to 6 percent of the sales price to cover the buyer's closing costs. Some items, such as prepaid taxes and the first month's mortgage payment, must be paid by the buyers. Sellers may also contribute to paying the appraisal, points, title insurance, settlement attorney fees, state or local transfer taxes and similar items.

Keep in mind that if the credit is included in the price of the house, the appraiser will have to justify the amount, based on sales prices of similar homes in the neighborhood.

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Bart Davis
Lifestyle Real Estate
122 W. Tombigbee Street
Florence, AL 35630
Bart's Phone: 256-810-7736
Office Phone: 256-766-7355
Fax #: 256-766-0385
Email: bart@davisteamsells.com

Lifestyle Real Estate works hard to give our clients the best service we can. Contact us anytime with any questions or advice you might have about the Shoals Area.

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