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Two offers on the same home can leave a buyer with different monthly payments and different amounts due at closing. A lower price, a credit toward closing costs, and a temporary mortgage buydown each solve a different problem.
In Episode 4 of The Real Estate Huddle, host Ron Sweeney sits down with two mortgage professionals and a new-construction representative to talk through those choices. They discuss what sellers can offer, how buyers can compare builder incentives, and when agents should bring the lender into the conversation.
Episode Guests
- Ron Sweeney, host · Managing Partner, Coldwell Banker Heritage.
- Rob, PrimeLending · Discusses mortgage options and financing for rental-property investors.
- Bill Riley, CrossCountry Mortgage · A Springfield, Ohio branch manager and mortgage loan officer who discusses seller concessions and ways to compare financing scenarios.
- Jody Clifton, D.R. Horton · Shares a builder’s perspective on new-construction incentives and working with buyers and their agents.
Watch Episode 4
Topics Covered
- Seller credits, price reductions, and cash to close
- Temporary mortgage buydowns and payment changes
- Financing incentives on new-construction homes
- Fixed-rate and adjustable-rate mortgage comparisons
- DSCR financing for rental-property investors
Key Takeaways
Start with the buyer’s biggest constraint. If the buyer has enough for the ongoing payment but needs help with upfront costs, a seller credit toward eligible closing costs may address that gap. A lower purchase price can reduce the amount borrowed. Ask the lender to model each option and compare the buyer’s cash to close and total monthly payment. Sellers can ask their agent to compare estimated net proceeds for the same scenarios.
Budget for the payment after a temporary buydown ends. A temporary buydown subsidizes part of the payment for a set period. Ask the lender for the payment schedule and identify when your out-of-pocket payment will increase. Use the full payment when deciding what fits your budget, including applicable taxes, insurance, and mortgage insurance.
Read the terms behind a builder incentive. A builder’s offer can depend on the specific home, the closing date, or the lender you use. Ask for the terms in writing, then compare the offer with another Loan Estimate for the same property. Look at the purchase price, lender fees, credits, total monthly payment, and cash to close together.
Compare an adjustable-rate mortgage with a fixed-rate option. If an ARM is part of the conversation, ask when the rate can first change and how high the payment could go. Comparing both offers helps you see the cost of the initial terms and how much room your budget has for a future increase.
Bring the lender in before writing the offer. A lender can explain which concessions the loan program allows and show what those concessions would do for the buyer’s upfront costs and monthly payment. The agent can then use that information to help structure the offer. For rental-property investors, the panel also introduces DSCR financing and the role rental income plays in a lender’s evaluation.
Compare Your Financing Options
If you’re weighing a resale home against new construction or trying to decide what to ask for in an offer, connect with a Coldwell Banker Heritage agent. To compare the financing itself, use the Consumer Financial Protection Bureau’s guide to comparing mortgage Loan Estimates.
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