No, they are considered reserves or pre-paid item and not "closing costs".

The P&S needs to be worded properly. We coach our Realtors to use this verbage; seller concession to include any closing costs, pre-paid interest, escrow (and upfront MIP for FHA loans). Some banks are very particular, and the contract needs to be as specific as possible.Have a great day!-Sean401-965-9384 directswheelan@tmgltd.bizwww.theFriendlyNeighborhoodMortgageGuy.com508-276-0171 fax

I will disagree with Mortgage First. You need to read the contract completely to determine what is included in the 4% and what is Not. Because contract vary from one city, state or town your realtor (or other local professional) should answer this question.

You must look at the sales contract and see how the 4% seller concession is reflected. Contracts do vary from State to State. If the contract reads 4% towards JUST closing cost it would be used for only that. However, if the contract reads 4% to be used towards Points, Pre-Paids and Closing Cost you would be able to use it towards your escrows for the taxes. You can check with your Loan Officer to confirm the proper wording for your contract that would be required by his/her Mortgage Company and to see if you will need an "addendum to the sales contract" changing the wording or not, which would have to be fully signed by all parties.

There are also closing costs to pay for items such as title policies, recording fees, inspections, courier charges, reserves to set up an impound account and fees that a lender charges. It is the fees a lender charges to make a loan that typically cost the most.Applying the 4 % will depend on your sale contract and the lender you use