Any time you enter into a negotiation on an offer to purchase on your home you always have to determine what is the breaking point. What this means is at what point do you say that enough is enough and you don’t care if you lose the buyer or not. Now, please realize that the housing market in the Allen Park or the downriver area as a whole presents a very difficult time for sellers. Sellers are being asked for an extraordinary amount of concessions in order to sell their houses. So, please keep this in mind when you are presented with an offer on your house. Most offers are coming in asking the seller to contribute 6% of the offer price to be used to fund the purchasers cost to close. On a $100,000 dollar house this amounts to $6,000. Now the buyer on most offers have to fund there own down payment. On an FHA mortgage the minimum down payment would be $3,500. Now, my question is “how much does it cost to originate a mortgage?”. Setting up escrow accounts for taxes is the major cost of funding a mortgage so let’s say this amounts to $3,000. Now there is a 1% origination fee, credit reports, home owners insurance, appraisal fees and surveys. The total of these fees (assuming the $3,000 for property tax escrows is correct) is $5,200. This leaves $800. This $800 could be used to (depending on the lender) buy down the interest rate for the buyer. The question I pose to you as the seller is: Is it worth losing the buyer over $800? If you have questions please ask through this medium or call me at the number provided.

Tags: Allen Park Homes, Downriver Homes., Lincoln Park Homes, Riverview Homes, Southgate Homes, Trenton Homes, Woodhaven Homes, Wyandotte Homes

Posted on Saturday, August 29th, 2009 at 12:08 pm and is filed under Homes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.