How to Save Money When Buying a Home: Strategies Beyond Down Payment Assistance Loans


Buying a home is a significant financial commitment, and saving money during the process can make a world of difference in the long run. While down payment assistance loans are an option for many homebuyers, there are alternative strategies that can help you save money without taking on additional debt. In this blog, we'll explore two powerful strategies that can reduce your upfront costs: offering a higher purchase price with seller concessions and requesting lender credits to cover those concessions.

Strategy 1: Offer a Higher Purchase Price with Seller Concessions

The concept behind this strategy is relatively simple but can have a substantial impact on your finances. Instead of negotiating a lower purchase price, you can offer to pay a higher price for the home and ask the seller to contribute towards your closing costs. Here's how it works:

Example: Let's say the home you're interested in is valued at $300,000. Instead of offering $300,000, you decide to offer $310,000 with $10,000 in seller concessions.


  • Reduced Upfront Costs: By offering a higher purchase price with seller concessions, you effectively roll some of your closing costs into your mortgage. This means you don't have to pay as much upfront, which can be especially helpful if you're trying to conserve cash.
  • Easier Budgeting: Your closing costs are more predictable, making it easier to budget for your home purchase.
  • Competitive Advantage: In a competitive real estate market, this strategy can make your offer more attractive to sellers as it’s a higher purchase price, potentially helping you secure the home you want.

Strategy 2: Ask Your Lender for Lender Credits

Once you've negotiated seller concessions, you can further optimize your financial situation by requesting lender credits from your mortgage lender. Lender credits are funds provided by the lender to help cover your closing costs. Here's how you can use them:

Example: Let's say you've negotiated $10,000 in seller concessions. You can then ask your lender to provide you with lender credit to cover another $2,000. This may result in a higher rate, but if you work with a flexible lender like Orca Home Loans you will get the terms you need.


  • Reduce Closing Costs Even Further: Lender credits can help you cover not only the seller concessions but potentially other closing costs as well. This means you'll have even less out-of-pocket expenses.
  • Lower Monthly Payments: Since the lender credits are applied to your closing costs, your loan amount may increase slightly, but this can lead to lower monthly mortgage payments if you use the funds toward buying points, which can be more manageable in the long term.
  • Flexibility: Lender credits provide flexibility in structuring your mortgage to suit your financial goals and needs.


While down payment assistance loans can be helpful, they aren't the only way to save money when buying a home. The strategies mentioned above offer a smart alternative that can help you reduce your upfront costs without taking on `additional debt.

By offering a higher purchase price with seller concessions, you can shift some of your closing costs into your mortgage. Then, by requesting lender credits, you can further offset these costs. These strategies not only help you save money but also provide greater financial flexibility and predictability during the homebuying process.

Remember that real estate transactions can be complex, and it's crucial to work closely with a qualified real estate agent and mortgage lender who can guide you through these strategies and help you make informed decisions that align with your financial goals. With careful planning and negotiation, you can achieve your dream of homeownership while saving money along the way!