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Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 116774
Experience:  Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
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My name is ***** *****. I have a question regarding the Loan

Customer Question

Hi. My name is ***** *****. I have a question regarding the Loan Cost Provision language .... in the below context, does the "buyer's loan" and "financing" implies that it could be applied to the loan itself or does it limit to closing costs only? Loan Cost Provision: Seller shall pay up to $10,000.00 which shall be applied to Buyer's Loan(s) and settlement costs, including prepaids, loan discount, loan fee, interest buy down, financing, closing or other costs allowed by lender.
JA: Thanks. Can you give me any more details about your issue?
Customer: It isn't much of an issue but an understanding question. Is the Loan Cost Provision applies only on costs associated with a loan or can it apply on the loan itself. Example .. If the closing costs are 5K but the loan provision is 10K, there's a 5K that isn't used. Does that amount applies to the loan per the language of the Loan Cost Provision or is it a lost amount ?
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Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
The wording of this provision does not apply to the loan balance or principal itself, it applies only to fees and interest point reduction or closing costs, it has nothing to do with the body or corpus of the loan. If closing costs are $5K, you do not use the other $5K, it says "UP TO" $10K, not that you must pay $10K.

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