Keller Williams Greater Seattle, Ben Kakimoto, Seattle Condo Agent

Sale concessions can lead to higher down payment

By on June 17, 2009 in Feature, Mortgage, Real Estate with 0 Comments

Rhonda Porter who writes a mortgage blog, The Mortgage Porter, recently wrote an excellent article about how sales concessions may result in an increased down payment amount.

A sales concession is something that is not part of the real estate, such as cash, furniture, automobiles, decorator allowances, moving costs, or other “giveaways”. The value of the sales concession must be deducted from the sales price when calculating loan to values.

For example, if you have a sales price of $200,000 and patio furniture valued at $3,000; the sales price the lender will use is $197,000 (200,000 – 3000). Let’s assume you’re putting 10% down payment. Without the sales concession, 10% down would be $20,000. With the sales concession, 10% down is going to be a bit more:

How much more? Continue reading this article at The Mortgage Porter.

About the Author

About the Author: Ben Kakimoto is a Seattle condo and urban real estate marketing & listing specialist. Contact Ben to learn more about the Seattle condo and loft real estate market or about buying or selling a Seattle area condo. Find Ben on Google+, Twitter and Facebook. .

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