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A seller credit, also known as a seller concession or seller assist, is a financial arrangement in a real estate transaction where the seller agrees to provide the buyer with a credit toward the buyer’s closing costs or other expenses associated with the purchase of the property. Seller credits are typically negotiated as part of the purchase agreement and can help buyers reduce their out-of-pocket expenses and upfront costs when buying a home.

Example of Seller Credit in a Real Estate Transaction:

For example, suppose a buyer is purchasing a home for $300,000 and has limited funds available for closing costs. As part of the negotiation process, the buyer requests a seller credit of $5,000 to cover closing costs such as lender fees, title insurance, appraisal costs, and prepaid taxes and insurance.

The seller agrees to provide the $5,000 seller credit, effectively reducing the amount of money the buyer needs to bring to the closing table. Instead of paying $300,000 out of pocket, the buyer now only needs to pay $295,000 at closing, with the seller crediting the remaining $5,000 toward the buyer’s closing costs.

Note: It’s important to understand that seller credits are not included in the property records or publicly available on real estate listing platforms like Zillow. Seller credits are typically negotiated between the buyer and seller as part of the purchase agreement and are reflected in the closing documents and settlement statement provided by the escrow or closing agent.

Seller credits can be a valuable tool for buyers, especially those with limited funds or seeking to minimize their upfront costs when purchasing a home. However, it’s essential for buyers to carefully consider the terms and implications of seller credits, as they may affect the overall cost of the transaction and the financing arrangements.