Your buyer wants a credit. You need that cash for your next home.

You are close to selling your house. The next home is lined up, and the proceeds from this sale are doing a lot of work in that purchase. Then your buyer asks for a substantial credit. Saying yes could keep the sale moving, but leave you short of the cash you need for the next closing.

Before agreeing, put both transactions on the same page with your agent, loan officer and escrow team. Confirm the actual shortfall, negotiate where there is room, and compare financing alternatives before changing your loan. The goal is to complete the move with an affordable payment and enough cash, not simply to get one closing across the finish line.

One move, two negotiations

Here is a real situation shared by Nick Cunningham, with the homeowner's name and property details omitted. A seller buying another home faced a late request for a large credit. Funds for the next purchase were already tight. His agent, Tony Alfano, negotiated with the buyers of the existing home and reduced the requested credit by $2,000.

Tony then negotiated an additional $5,000 seller credit on the home his client was buying. That purchase-side credit covered closing costs, while the smaller concession on the sale preserved more of the seller's proceeds. Together, the negotiations addressed the cash needed for the purchase.

Tony Alfano is with The Alfano Group at Compass, serving Greater Sacramento. You can learn about his team on The Alfano Group's website.

The Alfano Group at Compass (new tab)

What the $2,000 and $5,000 actually changed

Compare the result with accepting the buyer's original credit request and receiving no additional credit on the next purchase. Assuming the purchase credit is fully usable and other figures stay the same, the improvement is $7,000 across the two transactions.

This is not a $7,000 check from a seller or a $7,000 price cut. One negotiation keeps money from leaving the sale. The other pays allowable expenses on the purchase. Count each benefit once. That distinction matters when your available cash is already close to the amount escrow needs.

First, find the real cash gap

Ask for an updated seller net sheet that includes mortgage payoffs, selling expenses, prorations and the proposed credit. Then ask for the current purchase cash-to-close calculation, including your deposit already paid, down payment, remaining costs and all credits. Set aside required reserves and the cash you want available for moving and immediate expenses.

Put three questions to the team: How much additional cash would we need if we accepted this request? When will the sale proceeds actually be available? Which changes can be approved and documented before our deadlines? A net sheet is an estimate, not a promise that money is ready to wire.

For Fannie Mae loans that rely on sale proceeds, the lender must document sufficient net proceeds with the existing home's settlement statement before or at the same time as settlement on the new home. Ask your lender and escrow team how they will coordinate that requirement for your transaction.

Fannie Mae: documenting proceeds from your home sale (new tab)

Negotiate with the whole move in view

Ask your agent to understand what is behind the request, review the supporting information, and explain your options under the signed agreement and deadlines. A smaller credit or another documented resolution may work. Your agent can also ask whether the seller of your next home will contribute toward eligible purchase costs. Neither side has to accept a new proposal simply because it would solve your cash gap.

Do not treat the pressure of a closing date as a substitute for reviewing the contract. If rights, cancellation or a dispute are unclear, involve the appropriate real estate attorney. Have agreed changes documented and shared with the lender and escrow, rather than handled through side payments.

A seller credit must be usable

A purchase credit can preserve your own cash by paying eligible closing costs. It does not simply become down-payment money. Fannie Mae, for example, does not allow seller contributions to replace the required down payment or reserves, and limits financing concessions by both eligible costs and the applicable percentage cap. Other loan programs have their own rules.

Fannie Mae: seller contributions and eligible closing costs (new tab)

Before asking for another credit, have the lender calculate the remaining room after existing concessions and eligible costs. An oversized credit is not automatically cash back. Also ask whether reducing your down payment would change the seller-credit limit. Two individually useful ideas can conflict when combined.

Could you put less down?

Possibly, if the revised loan qualifies. As a separate illustration, reducing your down payment by $5,000 at the same purchase price means borrowing $5,000 more. That preserves cash before any changes in fees or insurance. It does not reduce the home's price or make the extra borrowing free.

The lender needs to compare the new loan-to-value ratio, interest rate, payment and qualification. A smaller down payment can change loan terms. On a conventional loan, dropping below 20% down commonly adds private mortgage insurance, which protects the lender and increases your costs. Program minimums still apply.

CFPB: down payments and mortgage terms (new tab)

If mortgage insurance is already part of your plan, ask whether its price changes too. Compare the complete housing payment, including taxes, homeowners insurance and any association dues, with what you can comfortably afford after moving.

CFPB: private mortgage insurance (new tab)

Could a higher rate buy more lender credit?

A lender may offer a higher interest rate in exchange for a credit toward closing costs. That can reduce the cash needed now while increasing your cost over time. This is the rate-priced credit option, not a rule that every lender credit carries a higher rate; some credits are promotional or corrective.

CFPB: lender credits and discount points (new tab)

Ask for same-day options showing the rate, APR, loan amount, total payment, credit and final cash to close. Compare total costs over shorter and longer periods you might keep the loan. Credit divided by the extra monthly payment is a rough cash-flow comparison, not a complete cost analysis: remaining balances and other charges matter too. Do not build the decision around a guaranteed future refinance.

If you were planning to pay discount points for a lower rate, ask whether reducing that upfront expense is another workable choice. Have the loan officer price the alternatives under your actual rate-lock terms. A different rate or credit is not automatically available just because you request it near closing.

Give the lender and escrow time to check the changes

Negotiated terms still need to fit the loan. Ask the lender to confirm the updated borrowing amount, payment, debt-to-income ratio, funds and reserve requirements, and whether new underwriting steps are needed. A verbal plan is not a revised loan approval.

Fannie Mae: changes to underwriting information (new tab)

A corrected Closing Disclosure does not always restart the waiting period. Under the CFPB's TRID guidance, a new three-business-day period is required when the APR becomes inaccurate under the rule, the disclosed loan product changes, or a prepayment penalty is added. Other corrections generally do not trigger that new period. Your lender must determine which rules apply, and document preparation and funding can still take time.

CFPB: corrected Closing Disclosures and waiting periods (new tab)

The value of an agent who sees both closings

Tony's work in this example shows why negotiation is about more than the sales price. He addressed the concession on the home being sold and the closing costs on the home being purchased. Those negotiations addressed the cash need through the two transactions themselves.

Your situation may call for a different combination, or for reconsidering a move that no longer fits. Before accepting a last-minute request, bring your agent and loan officer into the same conversation: what can we change, what will it cost later, and does the complete plan still work for you?

General educational information. The negotiation example uses owner-supplied facts; alternatives and planning illustrations are not this homeowner's loan terms, a rate quote, loan approval or legal advice. Credits and loan changes require lender review and applicable documentation.