Price cut or seller credit?

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The credit leaves you$7,125 more cash

The price cut lowers the payment by $46 a month instead.

	Option 1: price cut	Option 2: seller credit
Price	$292,500	$300,000
Down payment	$14,625	$15,000
Credit toward closing costs	None	$7,500
Cash you need, before other costs	$14,625	$7,500
Principal and interest	$1,802	$1,849

The credit leaves you $7,125 more cash at closing. The price cut lowers the payment by $46 a month, which makes up the difference in about 12 years, 10 months. If cash is tight, the credit usually helps more. If you have plenty of cash and plan to stay a long time, the price cut can be the better choice.

Seller credits can only pay closing costs and prepaids, not the down payment, and programs cap them (conventional 3% to 9% depending on down payment, FHA 6%, VA 4% of concessions, USDA 6%). A lower price can also lower property taxes over time.

The same dollars from the seller, two ways: a lower price, or a credit toward your closing costs.

How this tool works

A credit lowers the cash you need at closing; a price cut lowers the loan and the payment. Seller credits can pay closing costs and prepaids, not the down payment, and each program caps them.

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