Stacey Dille · Your Mortgage Loan Gal
What can a seller credit really do?
For real estate agents. Buyer's agents can see how much to ask for in closing costs. Listing agents can show sellers what a credit can do. Plug in the price and a typical down payment to see three options, what each one costs, and what it does for a buyer's payment.
Temporary buydown + closing costs
The seller pays to lower the buyer's rate for the first one to three years. The payment steps up each year until it reaches the full rate.
Buyer's payment path
| Year | Rate | Principal + interest | Est. PITI | Saves per month |
|---|
Permanent buydown + closing costs
The seller pays discount points so the buyer keeps a lower rate for the life of the loan. One point equals 1% of the loan amount.
What it does for the buyer
| Rate | Principal + interest | Est. PITI |
|---|
Closing costs and prepaids only
A straight credit that covers the buyer's estimated closing costs and prepaids. No change to the rate or payment, but less cash needed to close.
Same money from the seller. Very different result for the buyer.
Here is what the same dollars do as a price reduction compared with a credit that buys down the rate permanently (2 points gets about 0.75% off the rate).
Price drop
Rate buydown credit
Want me to run it for a real buyer?
This is a starting point. Send me the address and I will look at real pricing, so you can walk your sellers or buyers through the best option with confidence.
Don't be silly, get your mortgage with Stacey Dille.
Call or text (801) 232-4484
Stacey@yourmortgageloangal.com