Glossary
Financing
Seller concessions
Costs the seller agrees to pay on the buyer's behalf at closing, such as closing costs or rate buydowns, negotiated in the contract.
Seller concessions are amounts the seller agrees to contribute toward the buyer's side of the deal — most commonly covering part of the buyer's closing costs, prepaying items like insurance or taxes, or funding a temporary or permanent interest-rate buydown. They are negotiated into the purchase contract and show up as credits on the settlement statement. Lenders cap how much a seller can contribute, and the cap depends on the loan program and down payment, so the ceiling is a question for your lender.
Concessions are really a form of price: a $300,000 sale with $9,000 in concessions nets the seller about the same as a $291,000 clean sale, but the buyer needs less cash at the table. That makes them a favorite tool in slower markets and for cash-constrained buyers. The caution is that the appraisal still has to support the gross price — concessions baked into an inflated price can push a deal past what the property appraises for.
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