What is Seller Contribution or Seller Concession?

A seller concession or seller contribution is an agreement as part of a contract in which a seller pays some of a buyer’s financing and/or closing costs at closing.

Why does a buyer want a seller to pay some of their closing costs?

There are many reasons a buyer may ask a seller to pay for some of their closing costs. It could be anywhere from they want to keep some money in reserves or accounts, they may need the money to close, they may want help, they could want to do work on the house after they buy it and this would help. In the long run, why a buyer may ask a seller to pay some of their closing costs is between the buyer, their agent, and their lender.

Does a seller have to pay a seller concession or seller contribution?

There is not a requirement for a seller to pay a seller contribution to a buyer unless a seller agrees to pay a seller concession and signs an agreement as part of a contract, then that is when a seller would be required to pay.

As a seller, does this mean I have to bring money to closing?

In Maryland, a seller concession or seller contribution is usually taken out of the proceeds that a seller is receiving on the house once it closes. If what a seller is receiving in proceeds is less than their costs, then a seller would need to bring money to closing. Otherwise, it is usually shown on a closing form as a reduction in the amount the seller nets in proceeds.

Here are more details about seller concession in an article from Chron.

For more information on seller contribution or seller concession in Baltimore real estate, please contact me. I would be happy to help navigate a Towson real estate contract once hired to work for you!