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How to document sellers paying for closing costs

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12/02/2016 | Author: Legal Staff

I represent buyers who are interested in purchasing a home and want to ask the seller to pay for part of their closing costs. They intend to use conventional financing instead of FHA financing, so there will be no FHA-prohibited fees. How do I handle this in the buyers’ offer?

An amount for a seller’s contribution to the buyers’ closing costs should be in Paragraph 12A(1)(b) of the contract. If the buyers were using a government loan program, such as FHA financing, for the purchase, this contribution would first cover expenses related to the program, but this does not apply in this situation. Instead, the seller's contribution would first cover the buyers’ prepaid items and then the buyers’ other expenses up to the amount listed for the seller's contribution. These expenses are defined in Paragraph 12A(2).

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Categories: Forms, Legal
Tags: closing costs, paragraph 12

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The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on Any legal or other information found here, on, or at other sites to which we link, should be verified before it is relied upon.

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