There are a lot of misconceptions when it comes time to sell your home, one of which is that you should update and upgrade your house to make sure it is as turnkey as possible for the new buyers. While this isn’t necessarily a “bad” thing to do, it often will cost you much more than simply offering a credit upon closing.
Credits are generally most commonly offered on older homes, or homes where the seller is ready to sell the home fast and doesn’t want the stress of completing repairs or upgrades prior to the sale. Credits are great for both sellers and buyers for many reasons.
The amount of credit you choose to offer is totally up to you and can range from a small amount of $500 or less for minor fixes or repairs and can go up into the thousands. One of the most common credits given is often for flooring. If your carpets, laminate, hardwoods, etc. aren’t in the best shape, oftentimes by offering a credit at closing, you will not only spend less, but in a lot of cases, the buyer prefers it this way as it allows for them to choose the flooring that they prefer vs. moving into a home with new floors that don’t match their specific desires for their new home.
With the market currently favoring sellers, credits aren’t as popular as many buyers are offering to purchase homes in “as is” condition. By doing so they are trying to get a better chance of having their offer accepted, however, even if you choose not to offer a credit for cosmetic issues such as flooring, you may still consider it for health and safety repairs.
Upon inspection, if there is a health and safety issue that is found, whether minor or drastic, you can either choose to fix the repair prior to closing or offer a credit at closing that will help cover the expense of the repair for the buyers. While in this scenario you may end up paying about the same amount either way, oftentimes the credit is more favorable as it allows for a more stress-free selling experience.
Regardless of whether you plan to offer a credit or not, it is important to discuss the pros and cons of doing so with your realtor so that you can ensure you are doing what will best suit you and your selling needs.
Read More: Can I give money to the buyers at closing?
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