Seller Concessions is just a fancy word for Seller-Paid Closing Costs. So how does it work? Well, when you make your offer, you have to actually put in writing that the seller will pay for “x” amount of your closing costs. It has to be a finite number; you can’t just say “you’re going to pay for it.” 

So as an example, let’s say we’re going to offer the seller $300,000 for their property and we’re going to ask them to pay $3,000 in closing costs. Now if you do it this way, you’re going to show up for your closing with $3,000 less than you would have had you not asked for it. The seller is going to net $297,000 for their property, $3,000 less.

 What if they say no? What you can do (and what I suggest you do) is go back into your offer and offer to buy the house for $303,000, I still want you to pay for $3,000 of my closing costs,  but now they’re going to net $300,000 for their property. The seller is made whole in this case.

What you are effectively doing is financing your closing costs in this example, which you technically can’t do. You can’t say “Hey Jim, I bought a house for $300,000 I need a loan for $303,000. That doesn’t work, it’s not allowed, and this is the way around it. Effectively you’re showing up to closing with $3,000 less cash out of pocket.