It may sound like a good idea to ask for the seller to pay for some or all of your (the buyer’s) closing costs. But you may want to think through this strategy first, for a couple of reasons. Remember, your ultimate goal is to get your offer accepted, AND for the lowest price possible, with terms favorable to you.
I don’t have the money
IF you have everything else in line for mortgage qualification (decent credit score, decent debt-to-income ratio, etc.), but are lacking the full amount of funds for your down payment AND the closing cost associated with getting the loan; THEN one acceptable strategy is to ask the seller to pay for a portion or all of your closing costs and pre-paid items due at the closing table.
I have the money, I just want the seller to pay
If you have the funds necessary for down payment and closing costs, then asking for the seller to pay these may not be in your overall best interest. Keep in mind that all sellers have their own closing costs that will be deducted from their proceeds at closing. When you ask the seller to pay for your closing costs, you are in essence asking them to “net” less if they accept your offer. Because of this, your offer of $150,000 (asking for a contribution of say $5,000) is really a $145,000 offer to them, in their eyes. Remember, seller is looking at the amount they will ultimately put in their pocket at closing (their “net” number) the Knowing this, sellers will often negotiate to a number that is $5,000 higher than their bottom number to cover this added expense. You are in essence financing your closing costs for 30 years.