New construction has been a dominating factor when buying a home especially in the Eastern Loudoun county area of Ashburn, Aldie, Chantilly, Leesburg & Sterling area.
As we know when buying a new home the builder writes a contract. One of the clause/term in the new home purchase contract is "Buyer shall pay for builders Grantor's tax bill."
See below screen shot of one my buyers home purchase contract drafted by a major builder.
So, what is wrong with buyer paying for builder's tax bill?
If you were purchasing a new resale home in the Northern Virginia area of Fairfax, Loudoun or Prince William county, the home seller would be typically paying for their share of the closing cost which would include Grantor's tax & Congestion Relief Fee.
Again, So what is still wrong with buyer paying builder's grantors tax?
Let's step back and think about it. You receive a closing cost assistance from the new home builder say $7K. Out of the $7K part of it will go towards loan origination fee that their builder's preferred lender typically charges plus Grantor and Congestion Relief Fee you will have to pay on behalf of your home builder.
Now do the math.
What is left behind is a small change for you to truly apply the credits towards your closing cost.
Hmmm...now it makes sense!!
What can you do about this?
Well, in real estate as we say everything is negotiable. Having a local Realtor who understands the new construction market in the Virginia area is your best bet for helping you negotiate and understand these sorts of hidden clause.
Do note that not all the builders in the Northern Virginia area hold buyer responsible for their share of the tax bill. Review the sales contract to understand what are your terms & clause.