To help with the closing costs, some property Sellers on this site are offering a cash rebate incentive to the Buyers on closing of their transaction, Buyers who will buy the property direcly from the Seller without a Buyer's Agent or REALTOR®. Please make sure you read all the following information, restrictions and qualifications applying to the payment of a rebate to you by the Seller on closing.
Restrictions & Qualifications for the Seller's Cash Rebates Program.
$$$$ Cash Rebate?
Yes, the Seller of a property can legally offer you the Buyer thousands of dollars in Cash back on closing of his transaction. This rebate can be funded by the Real Estate Commission the Seller saves when a purchaser buys the property directly from him without the help of an Agent/REALTOR®. The savings make for additional funds available to the Seller to share and rebate to his Buyer as a reward for dealing with him directly. Simply these are funds that may otherwise have been negotiated with the Seller by a Buyer's Agent to cover his commission for bringing an acceptable offer to the Seller from an interested Buyer.
Home Buyers need to know that the cost of the real estate commission is normally included as part of the asking price and the eventual sale price of the property as it is in the case of most Listings for sale on the Quinte & District Real Estate Board MLS® System. Therefore the rebate does not affect the market value of the property since market value normally includes the cost of a competitive commission rate for most listings sold on the Board MLS® System. This is call the cost of sale and usually a for Sale by Owner will try to sell privately because he hopes to save and keep the whole commission cost for himself, that is the goal behind of a private sale, however in this case the seller is not looking to keep it all as he is willing to reward his own buyer by passing some of the savings which then can be used by the Buyer towards the closing costs or in a lower purchase price if the buyer is not interested in a cash rebate on closing. This makes the property a much better deal for Home Buyers who are looking for true real value in today's Market!
Why a Rebate?
The Seller would like to help you with the purchase of his property by offering you a substantial cash rebate, which in turn makes his property far more attractive and priced competitively compared to others properties who may be listed by a Traditional 5% commission REALTOR® providing a traditional service as oppose to being listed with a mere posting on the MLS® System and MlS/REALTOR.ca by a Discount Real Estate Commissions or Flat Fees Brokerage such as HomeLife Unlimited Connections Realty Ltd. Brokerage.
The Seller also knows from experience that there is no such thing as the perfect house, especially if the property is not brand new. There is always something that could be change or improved on a property. Even brand new houses today don't always come with A/C, hardwood floors or ceramic tile floors, a garage door opener, a completed landscaping or a paved drive, privacy fences or a full finished basement and so on. So a cash rebate on closing may come in handy to make some improvement to fit your criteria. After all most people immediately after buying a house don't always have the extra cash to make some improvement right away, they may have to wait a long time to save enough extra money to be able to afford any additional expenditures.
What could I use this rebate for?
For instance you could use the rebate to reimburse yourself or to help pay for your closing costs such as, the Lawyer's Fees, the Land Transfer tax, disbursements and other moving costs just to name a few. Some buyers may need some furniture or appliances or even a brand new large flat screen TV. Perhaps money to help with the downpayment on a new car or truck after you move in into your new home. Here are a few good ideas; pay down a interest rate balance on your credit card or use the cash back to repay your RRSP if you used it for buying the place or if not to get money back on your tax return next year or you could use your rebate to buy down for a while the interest rate on your mortgage or you could put the money aside as a safety net for a rainy day if something was to happen and you could not make your payments for a while. It is wise when you own a house to have at least 3 months saved aside to cover your monthly payment just in case. Whatever you decide, it is up to you what you do with the money, once you got it in your hands, it is your money on closing.
If I have my own REALTOR® or Agent do I qualify for the rebate?
Unfortunately you don't qualify for the rebate if you buy the above listed properties with another Agent. This should make sense to you because if there are too many hands in the pie, there won't be enough to go around for everybody. So in order to qualify for the rebate you must not be working or purchasing the property with a REALTOR®/Agent, because you need to buy the property directly through the Seller to qualify for the seller's rebate, otherwise the rebate may go towards paying the REALTOR®'s commission, a fee that a Buyer's Agent may charge the Seller for helping you buy the property which in turn, will make it impossible for the Seller to afford to pay you a cash rebate plus paying for the Agent's commission on closing on top of a rebate.
The Seller knows that you don't need an Agent to buy the property directly from him, after all this is a Private Sale, all you have to do, if you like the property, is to make a verbal offer to the Seller and he will take it from there. It is that simple! However if you have an Agent or you choose to, you can still buy the property if you like it, but remember if you make your offer by using a REALTOR® because you are legally tie up with an Agent due to a Buyer's Representation Agreement or whatever the reason may be you choose to use a REALTOR® to make your offer, then unfortunately you do not qualify for any rebate what so ever from the Seller! This is not negotiable unless you are paying for your Agent's real estate fee directly out of your own pocket and he is not trying to get it out of the Seller. You should know that the Seller is against paying commission fees but he is not against REALTORS®. Never the less the Seller would rather pay you a rebate, than having to pay for a REALTORS®, if at all possible. This should all makes sense to you now!
What else do I need to do to qualify and claim my rebate?
To qualify for your full cash rebate, all you need to do is to make the right offer to the Seller, only the right offer acceptable to the Seller at his own discretion will qualify the Buyer for his rebate. If you are serious about buying this property, then you need to talk to the Seller immediately upon the showing and negotiate the right offer with your rebate in mind. However, if you don't want the cash rebate or need a lesser rebate then you need to negotiate the offer accordingly. It is that simple.
How does, my rebate works legally and with the bank?
The rebate will be part of the total purchase price and will be inserted as a legal clause in the body of your Agreement of Purchase & Sale. It will state this is a Seller Commission Rebate to the Buyer for not using an Agent to purchase the property from the Seller and it is to be use towards the closing costs but is not to be used as a down payment.
Buyers should always be pre-approved and have sufficient funds up front to cover their down payment prior to the purchase of a property. This rebate will be paid by the seller directly to your lawyer in trust on closing of transaction as part of the terms of the Agreement of Purchase & Sale and handed over to you by your solicitor on closing as your rebate. Many Banks offer similar rebates to Home Buyers who deal with their institution for taking out a mortgage with them, this being perfectly legal as long as it is properly disclosed in writing to all parties involved and affected by the transaction. Your condition of financing on the offer will allow you to verify the policy of your own bank in this regard.
If I have any more questions or concerns what do I do? Call John!
Always remember that John Gagnon Your Trusted #1 Local Discount Broker in the Quinte Area can help you $ave Thousands. Call 613-242-4642 or 613-966-7555 & $ave your money!