Most Realtors don’t know the formula I’m about to teach you and it’s their clients that are literally paying the price. My name is Peter Chanbris I’m with joincincinnatistopteam.com where we’re here to create five minute or shorter videos that help you level up your career and real estate sales now this formula is a Formula that all lenders know and almost no Realtors know and unfortunately because real estate agents don’t know about this formula they’re not writing contracts that can best leverage today’s market to reduce the affordability for their buyers home on the new home that they purchase so let’s get into this formula right away in the last two videos we’ve talked about how we can get buyers take advantage of the opportunities in today’s market by using a three two one or a 2-1 mortgage program that requires seller paid closing costs the question is how many closing costs can a seller pay here’s the formula that lenders use for conventional mortgages now these can change we’re not the experts the lender is our job our responsibility is conversational so we can educate our clients get them in front of the more mortgage professional and they can tell us what our opportunity is but here’s how this works for conventional loans where the buyer is putting less than 10 percent down that is to say the loan to value ratio is 90 or more conventional mortgages will allow the seller to pay up to three percent of the purchase price in buyer and seller paid closing costs and prepaids for the buyer quick example if the two hundred thousand dollar deal the seller can pay three percent or up to six thousand dollars in buyers closing costs and prepaids this is where it gets interesting if your client is putting 10 percent to as much as 25 percent down on their home they can have the seller pay up to six percent of the purchase price in prepaids and closing costs guys on a 200 000 loan that’s twelve thousand dollars you can do a ton of rate buy down with that much money now look at this if your client is putting more than 25 percent down it actually goes to nine percent that’s a lot of money that would be eighteen thousand dollars on a two hundred thousand dollar purchase let’s look at federal government our guaranteed loans for FHA and USDA six percent is the maximum amount again on a two hundred thousand dollar purchase on an FHA or a USDA loan you can have up to twelve thousand dollars right six percent of 200 000 purchase price towards uh buyers prepaids and closing costs now remember the average three two one loan requires only about four percent in seller paid uh prepaid and closing costs for the buyer so there’s more than enough room here for your government loans and then this is the Whopper check this out there is no limit currently on VA loans uh no limit for the seller’s prepaid and closing costs paid on behalf of the buyer uh for VA loans that’s a massive opportunity and so when you are equipped with this information and you can let your clients know about it uh and encourage them talk to the lender you become the subject matter expert you become the hero because you know a formula that most Realtors don’t that can Empower your clients to make offers that can get accepted at interest rates that they’re comfortable with in today’s up in today’s market and that is how you level up your income in 2023. stay tuned if you found this interesting please do subscribe to our Channel or like our page if you’re on Facebook I’ll see you in the week thanks