Cash Offers & Seller's Costs: Who should pay?

[Kurt G.]

When your maximum allowable offer on an off-MLS property is lowish relative to ARV due to condition of the property, what is the best way to handle seller's costs, such as transfer tax and prorated property taxes? Is it better to make a slightly better cash offer and then have the seller walk away with less at closing after paying their costs, or is it better to make a lower cash offer up front and explain that that is exactly what the seller will have in hand when they stand up from the closing table because I will have covered their costs?

Example A:  Offer is $70k cash, seller receives a check for $68,500 at closing after expenses

Example B:  Offer is $68,500, and buyer pays all buyer and seller costs at closing, and seller naturally receives $68,500 at closing

I've done it both ways in the two deals I've done, however one seller was real estate savvy, and the other was anything but.  It seems to me that it comes down to making sure that everyone has the same understanding, and that expectations are completely met when all's said and done at the closing table.  On the other hand, while the seller's net should be the same, there is a psychological element on the seller's side and it would seem that one way should work better than the other.  It's nice to know exactly what I am going to get when selling a property, but there's something to be said for a larger figure when you offer...   So I am curious - in general, which approach is more likely to land an accepted offer, assuming you know nothing about the seller's familiarity with buying and selling real estate?