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Mortgage loan buybacks, often referred to as repurchases, occur when a loan sold to an investor or GSE fails to meet the agreed-upon underwriting, legal, or regulatory standards. Loan buybacks also harm investors by introducing volatility and diminishing returns.
For starters most REALTORS and buyers, at least in the Northeast, refer to them as a Closing Cost Credit. Lately with all the real estate settlement talk they have often been referred to as Sellers Concessions. For the record they are one in the same. In many ways they help sellers because many buyers cannot buy without them.
Lenders, appraisers, and brokers typically reference market value when determining loan amounts or pricing recommendations. Closing Costs : Appraisal, legalfees, and possible prepayment penalties on your existing loan can erode some benefits. Distinguishing between market value and investment value is key to smart deal-making.
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