“Why should I pay the buyer’s closing costs? I’m already paying to sell my house.”

I understand the reaction.

You’re selling the home.

The buyer chose to buy it.

Why should one of their expenses suddenly become yours?

Sometimes it shouldn’t.

But when a buyer asks a seller to contribute toward closing costs, I don’t look at the request and immediately think:

How much is this costing my seller?

I want to see the entire offer.

What is the purchase price?

What financing is the buyer using?

How much are they putting down?

What appraisal protection exists?

What are the inspection terms?

How much earnest money are they offering?

What does the seller actually net?

Are there other buyers?

What leverage do we have?

And most importantly:

What is the seller receiving in return for the concession?

Because a seller concession isn’t automatically giving money away.

But it isn’t automatically a good strategy either.

The concession is one term inside the entire offer.

And that’s how I want to evaluate it.

SECTION 1: What Does It Actually Mean When a Buyer Asks You to Pay Closing Costs?

A Seller Concession Is Part of the Negotiation

When a buyer asks for the seller to contribute toward their closing costs, they are asking the seller to provide a credit from the seller’s proceeds at closing, subject to the purchase agreement, financing and lender requirements.

You may hear it called:

seller concessions, seller-paid closing costs, a closing-cost credit, or seller assistance.

Whatever language is used, the important part for the seller is the same:

It affects the economics of the offer.

Suppose a buyer offers $400,000 and asks for a $10,000 seller concession.

That is not economically identical to a $400,000 offer with no concession.

The seller needs to understand the expected net.

But I also don’t want to stop there.

Because the buyer could offer $410,000 and ask for $10,000 back.

Now it looks simple:

$410,000 purchase price
– $10,000 concession
= $400,000

So we're even, right?

Maybe.

But that brings us to the next question.

Seller Closing Costs and Buyer Closing-Cost Concessions Are Not the Same Thing

Sellers already have expenses associated with selling a home.

A buyer asking for a closing-cost concession is different.

The concession is an additional negotiated term in the purchase agreement.

That's why I don't want sellers confusing:

“What will it cost me to sell?”

with:

“Should I agree to pay some of this buyer's costs?”

Those are two different financial decisions.

A seller should understand the normal costs associated with their own sale and then separately evaluate what a requested buyer concession does to their estimated net and the overall strength of the offer.

A Higher Price With a Concession Can Look Net-Neutral Without Being Risk-Neutral

This is one of the most important pieces for sellers to understand.

Assume your home is listed at $400,000.

Buyer A offers:

$400,000 with no seller concession.

Buyer B offers:

$410,000 with a $10,000 seller concession.

On the surface, Buyer B may appear to have simply financed their closing costs into the transaction while preserving approximately the same amount toward the seller before considering other costs and terms.

But if Buyer B is financing the purchase, there is another question:

Will the property support the $410,000 contract price?

The seller concession does not eliminate appraisal considerations.

That's why What Happens If My Royal Oak Home Appraises Below the Sale Price? matters here.

A buyer and seller can agree to a purchase price.

The appraisal can still support something different.

And if the appraisal comes in below the contract price, what happens next depends on the contract, financing, appraisal terms and the positions of both parties.

So I would never evaluate a concession using subtraction alone.

A higher purchase price with a seller concession can look net-neutral on paper. That doesn’t automatically make it risk-neutral.

The Seller’s Net Matters More Than the Headline Number

Sellers naturally look at the offer price first.

I do too.

It matters.

But the offer price is not necessarily what the seller walks away with.

If one buyer offers $410,000 with a $10,000 concession and another offers $402,000 without one, I don't want to announce that $410,000 is automatically the better offer.

We need to calculate.

Then we need to evaluate.

What is the estimated seller net from each?

What financing is involved?

What appraisal exposure exists?

What are the inspection terms?

What are the contingencies?

What is the buyer’s ability to perform?

What closing and occupancy terms matter to the seller?

That's exactly why Should I Accept the Highest Offer on My Royal Oak Home? goes beyond the headline purchase price.

Highest and strongest are not automatically the same thing.

A seller concession is another reason why.

Why Would a Buyer Ask the Seller to Pay Their Closing Costs?

A buyer can be financially qualified for the mortgage and still want to preserve cash.

Buying a home involves more than the down payment.

Depending on the transaction, a buyer may have funds needed for closing costs, prepaid expenses, moving, immediate property expenses and other costs associated with the purchase.

A concession may also be structured within a transaction for allowable financing-related purposes, depending on the buyer’s loan and lender requirements.

But here's what I don't want a seller to assume:

A request does not automatically mean the buyer cannot afford the house.

And I don't want to make the opposite assumption either.

I want to understand the buyer’s financing and the offer in front of us.

Then we decide how much weight to give the request.

Do Sellers Have to Agree to Pay a Buyer’s Closing Costs?

No.

A buyer can ask.

The seller can evaluate the request within the terms of the offer and determine how to respond.

Accept it.

Reject it.

Counter it.

Negotiate another term.

Or evaluate another offer if one exists.

An ask is the beginning of a negotiation. It isn’t the answer.

That distinction becomes particularly important as buyers gain more choices.

Why the August 2026 Royal Oak Market Matters to This Conversation

In my Royal Oak Housing Market Update: What August 2026 Means for Home Sellers, we saw a significant change in buyer choice.

Royal Oak residential inventory increased 49.3% year over year, from 142 available homes in August 2025 to 212 in August 2026.

Months supply increased from 1.9 to 2.8 months.

New listings increased 20.5%.

At the same time, the August median sale price remained at $385,000, up 0.8% year over year, and sellers received an average of 100.1% of list price.

That doesn't tell me Royal Oak sellers should start offering buyers closing-cost assistance.

It tells me buyers have more alternatives.

More buyer choice can create more room for buyers to ask.

That's different from saying sellers automatically have to say yes.

And as we discussed in Article #102, Should I Sell My Royal Oak Home Now or Wait Until 2027?, this isn't isolated to Royal Oak. Oakland County inventory also increased in August.

The negotiating environment is changing.

That makes understanding the complete offer increasingly important.

SECTION 2: How Should a Royal Oak Seller Evaluate a Closing-Cost Request?

Start With What the Seller Actually Receives

Before I get emotionally attached to the concession amount, I want to understand the seller’s estimated net.

Take two hypothetical offers:

Offer A
Purchase price: $400,000
Seller concession: $0

Offer B
Purchase price: $410,000
Seller concession: $10,000

It would be easy to call them equal.

But I don't have enough information yet.

I still need the financing.

The appraisal terms.

Inspection.

Earnest money.

Closing.

Occupancy.

Contingencies.

And the buyer's ability to perform.

That's why Article #92, How Do Buyers Decide What to Offer on a Royal Oak Home?, treats the offer as a complete package rather than a purchase price standing alone.

Net matters.

Risk matters.

Terms matter.

Then Ask What the Seller Is Getting in Return

This is the part I think gets lost when a seller hears:

“The buyer wants $10,000.”

Okay.

What are they offering?

Maybe the buyer increased the purchase price.

Maybe their other terms are strong.

Maybe the closing date aligns perfectly with the seller's next move.

Maybe the buyer has substantial earnest money.

Maybe there is stronger appraisal protection.

Maybe another term reduces risk for the seller.

Or maybe the buyer wants a large concession while offering nothing that makes the request attractive to the seller.

Those are very different negotiations.

I don't want to negotiate the concession in isolation.

If we're giving something, I want to understand what we're getting.

The Buyer’s Financing Matters

The type and structure of financing can affect how seller concessions are handled.

Loan programs and lenders may have requirements governing how much seller assistance is permitted and what the funds may be used for.

That means I don't want to casually promise a concession—or assume a particular amount will work—without the financing side being reviewed appropriately.

And financing matters for another reason.

A preapproval is important.

It isn't a closing.

The buyer still has to move through underwriting and satisfy the requirements of the loan.

That is why What Can Cause a Royal Oak Home Sale to Fall Apart? discusses financing as one of the stages that still has to work after an offer is accepted.

The concession should fit inside a transaction that has a reasonable path to closing.

Appraisal Risk Still Exists

This deserves its own conversation because of the example Google surfaced when you searched this question.

Increasing the purchase price to offset a concession does not make appraisal risk disappear.

Suppose:

The market evidence supports a home around $400,000.

A buyer offers $410,000 and requests a $10,000 concession.

If financing requires an appraisal, the property still has to be evaluated in connection with that financing.

If the appraisal comes in below the contract price, we then have to look at the appraisal, purchase agreement, buyer's financing and negotiated appraisal protections.

That doesn't mean a higher-price-with-concession structure is inherently bad.

It means we need to understand the risk before calling it “free money” or “net neutral.”

What If There Are Multiple Offers?

Now the conversation changes again.

If we have several qualified buyers pursuing the home, the seller may have options.

Maybe one buyer wants a concession.

Another doesn't.

Maybe the buyer requesting the concession has the strongest price.

Maybe they have better terms.

Maybe they don't.

This is exactly where the principle from Should I Accept the Highest Offer on My Royal Oak Home? becomes useful.

We compare the contracts.

Not just the numbers at the top.

Purchase price.

Concessions.

Financing.

Appraisal.

Inspection.

Earnest money.

Closing.

Occupancy.

Contingencies.

Probability of reaching closing.

The concession is one piece of the offer—not the offer.

What If This Is the Only Offer?

Then I still don't automatically say yes.

But I do want to understand the seller's position.

How long has the property been on the market?

How much showing activity have we had?

What feedback have buyers given us?

Have other buyers shown serious interest?

How does the offer compare with market value?

What competing homes are available?

What happens if we reject the request and the buyer walks away?

What would the seller return to?

Those questions matter.

Article #92 makes the same point about a low offer: an offer is information, and the strategy should respond to the actual offer and actual market rather than an imagined negotiation.

The same applies here.

A $10,000 concession request can be unreasonable in one transaction and workable in another.

Context determines the strategy.

A Seller Concession Can Be Negotiated

A request for $10,000 does not mean the only choices are:

Give $10,000.

or

Give nothing.

Maybe the seller agrees to part of it.

Maybe the purchase price changes.

Maybe another contractual term changes.

Maybe the seller accepts the concession because the overall offer still produces the strongest combination of net, terms and probability of closing.

Maybe the seller declines because the market response gives them a stronger alternative.

That's negotiation.

And it is why I don't want sellers reacting to the words “seller-paid closing costs” before we evaluate what the buyer actually proposed.

Don't Confuse a Concession With a Price Reduction

They both affect the economics of the transaction.

But they aren't necessarily the same tool.

A price reduction changes the purchase price.

A seller concession provides an agreed credit within the transaction, subject to the contract and applicable financing requirements.

Depending on the buyer and transaction, those two structures can have different effects.

That's why I don't start with:

“Which one costs the seller less?”

I start with:

What problem are we trying to solve?

Is the buyer asking for assistance with allowable closing expenses?

Is affordability affecting the transaction?

Is the home struggling to generate buyer interest?

Are we negotiating after inspection?

Are we structuring an initial offer?

Are there competing buyers?

What does the seller need to net?

Different problem.

Different strategy.

The Signature by Lisa Perspective

“Why should I pay the buyer’s closing costs?”

Maybe you shouldn't.

But I don't want to make that decision because the request feels unfair.

And I don't want to accept it because someone says seller concessions are becoming more common.

I want to evaluate the transaction.

What are we giving?

What are we getting?

What does the seller net?

What risk exists?

What leverage exists?

What alternatives exist?

And how does this offer support the seller's goals?

A seller concession isn't automatically giving money away.

But it should never be evaluated separately from the rest of the offer.

That's the strategy.

WATCH: Why Should I Pay the Buyer’s Closing Costs?

Coming Soon

The Next Question: What Else Should I Look at Before Accepting an Offer?

A buyer’s request for closing costs is one term.

The strongest offer still has to be evaluated as a complete contract.

That's why the next step is understanding how price, financing, appraisal, inspection, earnest money, contingencies and the buyer's ability to perform work together.

Continue with:

Should I Accept the Highest Offer on My Royal Oak Home?

Frequently Asked Questions

Should I pay the buyer’s closing costs when selling my Royal Oak home?

Not automatically. A buyer’s request for seller-paid closing costs should be evaluated as one term within the complete offer. The purchase price, seller’s estimated net, financing, appraisal risk, inspection terms, earnest money, contingencies, buyer demand and the seller’s alternatives can all affect whether agreeing to the concession makes sense.

Does a seller have to pay a buyer’s closing costs in Michigan?

A seller does not automatically have to agree to a buyer’s request for closing-cost assistance. Whether a seller provides a concession depends on the negotiated purchase agreement, the seller’s strategy and any applicable financing or lender requirements.

What is a seller concession in real estate?

A seller concession is an agreed credit from the seller within the real estate transaction that may be used toward allowable buyer costs, subject to the purchase agreement and applicable financing and lender requirements.

Should I raise the sale price if the buyer asks for closing costs?

Not automatically. Increasing the purchase price may help offset a seller concession on paper, but the higher contract price can also affect appraisal considerations and financing. The complete transaction should be evaluated before deciding how to structure the concession.

Do sellers usually agree to pay a buyer’s closing costs?

It depends on the offer and the market. Seller-paid buyer closing costs are negotiable. Some sellers agree to them when the overall purchase price and terms still create a strong outcome; others decline or counter the request when buyer demand, competing offers or the seller’s net position support doing so.

Who normally pays closing costs when selling a home in Michigan?

Both buyers and sellers can have their own costs associated with a Michigan real estate transaction. A buyer asking the seller to contribute toward the buyer’s allowable closing costs is a separate negotiated concession and should be evaluated as part of the complete offer.

Can I negotiate how much I pay toward the buyer’s closing costs?

Yes. A buyer can request a seller concession, and the seller can evaluate the request and determine how to respond within the negotiation. The seller may agree, decline, counter or negotiate other terms depending on the offer and circumstances.

Conclusion

A buyer asks for $10,000 toward closing costs.

Do you say yes?

Do you say no?

Do you raise the purchase price?

There isn't enough information yet.

That's the point.

The concession amount alone doesn't tell me whether the offer is good for the seller.

I want to understand the price.

The seller's net.

Financing.

Appraisal.

Inspection.

Earnest money.

Contingencies.

Buyer demand.

The seller's alternatives.

And the probability of getting from accepted offer to closing.

Then we negotiate.

The buyer's request is one number.

The seller's decision requires the entire contract.

Closing Thoughts

“Why should I pay the buyer’s closing costs? I’m already paying to sell my house.”

Maybe you shouldn't.

But before saying no, understand what the buyer is offering in return.

And before saying yes, understand what the concession actually does to your net and your risk.

Because:

A higher purchase price with a seller concession can look net-neutral on paper. That doesn't automatically make it risk-neutral.

The strongest decision isn't automatically yes.

It isn't automatically no.

It's understanding the complete offer before deciding what you're willing to give—and what you need in return.

Find Out What Your Royal Oak Home Is Worth

Before evaluating an offer, start by understanding your Royal Oak home's probable market value and how it competes with the homes buyers can choose today.

I'll evaluate the comparable sales, condition, current competition and buyer demand to help determine your home's market position and how that evidence can support your selling and negotiation strategy.

👉 Find Out What Your Royal Oak Home Is Worth

About Lisa A. Mills

Lisa A. Mills is a REALTOR®, founder of Signature by Lisa, and is affiliated with National Realty Centers | Powered by JMG. She specializes in helping Metro Detroit homeowners confidently navigate life's transitions through strategic planning, local market expertise, and innovative digital marketing.

Known as The Calm Strategist When Life Shifts, Lisa believes selling a home begins with understanding—not assumptions. Through thoughtful preparation, strategic pricing, and a focus on buyer confidence, she helps homeowners make informed decisions that lead to stronger outcomes.