Although it has been some time since I have seen a movie in an actual theater, I do have fond memories of times past when going to a theater was the only way you would get to see a film. After all, before Jaws was on an endless loop on cable — and long before you could pop a VHS into the VCR — it had only one home: the big screen. There was nothing quite like the oversized mechanical shark, bigger than life, opening its gaping mandible to take a bite out of a boat. Better still were the overpriced concessions that made the whole ordeal a “cinematic experience.” Nothing compares to watching a movie with the bucket of popcorn that costs more than your car payment or a trough of icy Coca-Cola you had to grab post commercial enticement.

Better than a $12 box of Red Vines, real estate concessions play a similar role; the little add-ons (or big ones) can make the main attraction more palatable. Instead of neon orange nachos with glow in the dark cheese, you might get seller-paid closing costs, with a side of a washer/dryer combo. Rather than sticky fingers and regret, you walk out with a deal that is much easier to swallow.

In real estate, a concession is when the seller agrees to cover certain costs tied to the buyer’s purchase. While this is primarily a benefit to the buyer, it can also make it more appealing to more buyers who may not otherwise consider the home. This can, in turn, also benefit the seller as it serves as an extra incentive for buyers to make an offer, especially in a high inventory market such as ours.

Concessions can take different forms. The most common concession requested by a buyer is closing costs. The buyer can ask the seller to pay for some or all the costs associated with the loan. This can be offered as a certain percentage of the offer price, or it can be in the form of a specific dollar amount. Closing costs are the fees and expenses (aside from the down payment for the home) that are associated with the cost of securing a loan and finalizing a real estate transaction. For the buyer, this can run anywhere between 2%-6% of the purchase price of the home.

Although the lender can make a pretty good haul from the interest paid on the loan (assuming the loan initiator keeps the loan and doesn’t sell it on the secondary market, which is a whole different conversation for another time), there are other costs associated with initiating a loan and transferring a property. In fact, there is a whole cast of characters involved: a loan origination fee, processing, underwriting, credit report and verification and appraisal are all included in this fee. The lender will require a title search as well as title insurance. They want to be sure no one else has a legal claim to the home (and so do you). Escrow fees are paid to the title company. These are the people who handle the money and documents. They also are the ones that will record the property once the property closes and officially transfers title.

Other closing costs can include prepaid home insurance, property taxes, home warranties or seller credits for needed repairs. Perhaps a radon test showed higher than recommended radon levels and the seller agreed to just credit you the money to install the radon system after closing. This does not mean you will get $2,000 back at closing, it simply means there will either be a reduction in purchase price or a credit toward “closing costs.”

A seller can also contribute to a temporary interest rate buy-down for the buyer. This can give the buyer a lower rate for the first year or so until the buy-down has expired and the rate goes back to what it was initially. This gives the buyer a little breathing room, even if it is for just a couple of years.

Concessions don’t mean you got a deal. They mean someone tried to sell you the $14 popcorn and you said, “I’ll only buy it if you throw in a box of Raisinets.” And they just might do it. Not because of the generous nature of sellers right now, but because sometimes a small loss now saves a big headache later — much like that neon blue slushy from the movie theater concession stand that you chugged in one heroic, impulsive gulp.

Jen Fischer is an associate broker and Realtor. She can be reached at 801-645-2134 or jen@jen-fischer.com.