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Getting The Seller To Pay All Closing Costs
As a full time Canadian real estate investor, you will come across many situations that involve negotiation. Negotiation is key to your success. Understanding the methods of negotiation and all that is available to negotiate for is crical to making perhaps a good deal even better.
Negotiate on price only?
The average investor usually only considers the price as negotiable. You, on the other hand, as an educated investor, may consider many other “angles” to negotiate. The more you know, the more money you will make; the better prepared before you go into a negotiation, the more money you will make: it is that simple.
If the seller absolutely needs the price
If a seller is very hard on the price that they want, or perhaps need (i.e. their mortgage amount ), you can negotiate other terms. One of these terms may be the seller paying all your closing costs. As was mentioned in a previous article, the closing costs can be as follows:
- The seller can pay your land transfer tax, if you are in a province where that is required
- The seller can pay for your appraisal
- The seller can pay for your legal fees and title insurance
- The seller can even pay for your broker fees (which are incurred as a result of getting a private mortgage on the property)
Why would a seller do this?
There are a myriad of reasons why a seller may need to get out of their property quickly. They may have a job transfer, a divorce, a death in the family, a foreclosure, all with a particular time line they must adhere to. Perhaps you are the only one that has come along and shown interest in that property. You now have bargaining power…use it!
When you have bargaining power you can negotiate particular terms, allowing you to get into deals that end up requiring none of your own money. One of those terms is the seller paying your closing costs.
Remember, there is more to negotiate than price.
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An article by Gord Lemon
Gord Lemon has been investing in Canadian real estate for over 25 years. He has been a real estate investment trainer since 2002 and is co-founder of Canadian Wealth Builders. To read more articles by Gord Lemon |
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