Non-recurring Closing Costs

Sellers sometimes pay for all or a portion of the closing costs involved in the sale of a property, depending on local real estate market conditions, other terms of the purchase contract, the seller's cash and timing considerations.

Seller concessions, as they are known in real estate jargon, for at least part of the closing costs are more common in a buyer's market than in a seller's market. These concessions will typically be agreed upon during the offer, counteroffer acceptance cycle, though sometimes a seller will make further concessions during the escrow process. Such concessions would generally be acknowledged in the form of an addendum to the purchase contract.

In addition, most lenders will allow a credit from the seller to the buyer for the buyer's nonrecurring closing costs. But they usually won't allow a credit that reduces the amount of the buyer's down payment, or that includes any of the buyer's recurring closing costs, which include such expenses as fire insurance premiums, interest on the buyer's new loan, property mortgage insurance and property taxes. Lenders' policies vary on how large a credit for nonrecurring costs they'll allow.

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