Investor · West Chester , PA · Member since 2011 · 620 posts · 138 votes
Hello Everyone
I have $200K full listing price offer from FHA buyer but condition is to credit/concession $8,000 for closing cost.
Issue is that buyers agent adding a condition in the contract if the appraisal is less than listing price $200K then buyer will renegotiate the credit/concession amount.
Sellers net will be $192K if there’s no issue with appraisal value but if appraisal comes $195K buyers still wants $8,000 but I want offer $3,000. Who’s right? And what I can do
@Sai T. no one is “right”. Each side has terms they want met. You have to meet in the middle if you want the deal done.
Why do you think the property won’t appraise? If you’ve run your comps correctly, then their shouldn’t be an issue.
I would offer a 2.5% (5k) sellers assist contingent on the appraisal coming back at asking price(if appraisal is that big of a concern). If the appraisal comes back lower, you need to renegotiate.
@Sai T. no one is “right”. Each side has terms they want met. You have to meet in the middle if you want the deal done.
Why do you think the property won’t appraise? If you’ve run your comps correctly, then their shouldn’t be an issue.
I would offer a 2.5% (5k) sellers assist contingent on the appraisal coming back at asking price(if appraisal is that big of a concern). If the appraisal comes back lower, you need to renegotiate.
I would reject the buyer concession for appraisal and stay with the $8000 credit . Let the buyer get the appraisal then you will know if its even an issue or not . Also FHA brings repair conditions so you will have other points of negotiation to contend with. If they are serious they will pay for the appraisal.
FHA will allow up to a 6% seller concession, which in this case would amount to $12,000. The $8k concession request from the buyer appears to be fairly reasonable, however, that is the seller's call to make. The concession, along with any other terms or conditions are always open for negotiation.
@Sai T. I agree with you to an extent. I think that would be the case if you had a unique property where there weren’t many comps to give solid data. If the house is “average” for tour market, you won’t have much of a problem.