What is the Difference Between a Financing Concession and a Sales Concession in a Purchase Transaction?
Posted by Robert Ruth on
Written by Robert H. Ruth
What is a concession?
A concession is some benefit usually offered from the seller to the buyer that helps in the negotiation to buy a home. The concession is typically financial in nature, and is in essence, a type of deal sweetener for the buyer. In the real estate finance industry, concessions are also known as Interested Party Contributions (IPC’s). For this article, I wanted to explain the 2 most common types of IPC’s: financing concessions, and sales concessions.
Financing Concessions
These IPC’s are paid on the borrower’s behalf by the seller to help facilitate the transaction. Financing Concessions typically cover closing costs for the buyer who is financing the purchase with a mortgage. They are…
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