A seller agrees to a $5,000 concession toward the buyer's closing costs. At closing, the buyer's actual closing costs total only $3,500. Under Ohio agency law and standard closing practice, what happens to the remaining $1,500?
Correct Answer
C) The concession is reduced to $3,500 and the difference is credited back to the seller
Seller concessions are permitted only to offset documented, actual closing costs. When actual costs are less than the negotiated concession, the excess cannot be paid out as cash to the buyer or redirected to other parties. The concession is reduced to match actual costs, and the unused amount reverts to the seller. This reflects both standard Ohio closing practice and lender guidelines governing seller-paid concessions.
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