Home Buying Incentives You Should Look For
Published by Jeremy Winters on 2012-02-13 15:45:42
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There are many benefits that can be gained from home ownership. Some of the most well understood home buying incentives are the tax benefits and the retirement benefit of owning a home without a mortgage. However, the home buying process may bring with it even more positive benefits.
Everyone who has a property for sale knows how difficult it is to move a home in today's market. Consequently, home buying incentives can be found almost everywhere. Sellers offer incentives to potential buyers that range from LCD TVs to cruises.
These manic attempts at wooing buyers are most effective when they have a direct effect on the buyer's final price. A seller who offers to pay the buyer's closing costs is very likely to capture the buyer's interest. Knowing that closing costs can reach up to 3% of the final price, most buyers would be happy to accept that reduction in their expenses.
In some instances the buyer is eligible for seller financing which is also a great incentive. Seller financing has some inherent benefits like when getting into a property that cannot be financed by a bank. If the bank is unwilling to give the buyer a mortgage, seller financing may be the only option for obtaining the property. The buying price may be a little higher and the interest rate steeper but the mortgage is usually for 5 to 10 years, giving the buyer enough time to qualify for refinancing. Traditionally it is easier to obtain refinancing than a first mortgage.
Sellers also offer to pay other related costs like the first one or two mortgage payments. They may also agree to pay private mortgage insurance (PMI), property taxes or even home owner's insurance. Sellers who are serious about moving their property may even offer furnishings if they know the buyer wants them with the property. They may include a desk that fits perfectly in an upstairs office or an armoire that perfectly suits a room without closets.
Today many real estate companies and even communities are jumping on the band wagon with their own home buying incentives. Real estate companies are offering bonuses for buyers. They could receive as much as 3% back for closing on a house. The bonus can go up to $8000. Communities across the country are encouraging people to buy with 1% cash back after closing on a home. These same incentives are being offered by lending companies and brokers. Incentives even include sellers paying down points on a loan, permanently reducing the buyer's monthly mortgage.
Buyers are being courted by sellers who desperately want to sell their property. Sellers are willing to step outside the traditional to capture a sale. "Ask and you shall receive" is almost a new mantra for the buyer in today's market. Sellers are willing to do what it takes to close the sale and buyers should be aware of the vast possibilities when negotiating for a property.
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