Closing Cost Credits Structure to Benefit Your Home Purchase
Closing costs can be roughly 2-3% of your purchase price when buying a home in Illinois. With this figure, on top of downpayment amount, and a first time homebuyer can be intimidated by the costly amount of buying a home with the figures easily becoming 5%+ of the sale price. That is why closing costs credits are an integral part of reducing cost to the home buyer when purchasing a home!
So, can this figure be reduced? Yes, but, our video discusses ways to layout these closing cost credits to roll into the purchase price or interest rate. By doing so, the home purchaser saves money at the closing table. It also finances these closing costs into their mortgage at an affordable interest rate.
As of January 2017, when rolling the closing costs into your mortgage, you have the ability to write off the interest portion on your Schedule A of tax return (of course…always consult your accountant first!). Also, when the closing costs are financed into the mortgage, a home buyer will typically save on the purchase price of the home and increase their equity position in their home.
A home seller may also provide the home buyer a credit WITHOUT INCREASING THE PRICE OF THE HOME! In fact, while not discussed in this video, we STRONGLY recommend the Illinois Realtor representing the buyer ask the listing agent to maintain the sale price while requesting this closing cost credit before digging into the strategies provided in this video.
Check out this link for a rough estimate of closing costs when purchasing a $200,000 home in Illinois.