Builder Closing Cost Incentives: Are They Too Good to be True?
Jun 27 2023

When purchasing a new construction home, many builders will offer a variety of incentives to sweeten the deal and entice buyers. One of the most popular incentives is builder closing cost incentives, which promise to cover some or all of the closing costs associated with purchasing your new home. In comparison, these incentives can save you money upfront. However, it is important to understand their true cost and whether they are as good of a deal as they seem. In this post, we will explore the world of builder closing cost incentives and help you determine if they are too good to be true.

What are Builder Incentives?

You may have received builder incentives if you want to purchase a newly constructed home. Builders offer these discounts to potential homebuyers to entice them into purchasing a new home. Further, they take many forms, such as cash back at closing, upgrades to appliances or finishes, or even discounts on the purchase price. 

According to Amy Bonis, a real estate agent based in Los Angeles, some builders offer a loan or personal coaching programs. These programs can help first-time homebuyers navigate the complex home-buying process. These incentives can be very appealing, especially for those on a tight budget and those looking to save money on their home purchase. 

Common Types of Builder Incentives

In the process of buying a new home, builders often offer a variety of incentives to attract potential buyers. Here are some common types of incentives that builders offer: 

  1. Closing Cost Assistance

 Many builders offer to pay a portion or all of the closing costs associated with purchasing a new home. This can be a big help to buyers who are trying to save money on upfront expenses.

  1. Upgrades

 Builders may offer free or discounted upgrades to certain features or finishes in the home, such as upgraded appliances, flooring, or countertops.

  1. Home Warranty

Some builders provide a house warranty as an inducement to customers. This might provide you peace of mind knowing that specific repairs or replacements will be covered for a set time.

  1. Loan Programs

Amy Bonis partners with builders to offer specialized loan programs that make it easier for buyers to finance home purchases. These programs may offer lower interest rates or reduced down payment requirements.

  1. Personal Coaching Programs

Some builders may offer personal coaching programs to help buyers navigate home buying. These programs can guide everything from choosing a floor plan to securing financing.

Benefits of Accepting Builder Incentives

Accepting builder incentives can come with some significant advantages for buyers like you. Let’s explore a few of them:

  1. Financial Benefits

By offering builder incentives like closing cost assistance, builders can help you save money in the short term. This can be especially helpful if you want to stretch your budget further.

  1. Access to Upgrades

Many builders offer incentives like free upgrades or discounts on certain features of your new home. This can allow you to add luxury items or high-end finishes that you may not have been able to afford otherwise.

  1.  Additional Help

 Many builders also offer incentives like assistance finding a mortgage lender or other support during home-buying. This can help make the process smoother and less overwhelming for you.

How to Determine if Builder Incentives are Worthwhile

While it can be tempting to accept builder incentives, it’s important to make sure they’re truly worthwhile before making a decision:

  1. Cost Savings

The most obvious factor is how much money you will save by accepting the incentive. Suppose the builder is offering to cover your closing costs. Then, determine how much you would normally have to pay and compare that to the value of the incentive. 

  1. Other Costs

Keep in mind that accepting a builder incentive may come with other costs. Consider any additional costs associated with accepting the incentive and weigh them against the potential savings.

  1. Timing

Many builder incentives come with strict deadlines or timeframes for acceptance. Ensure you can meet these deadlines and that accepting the incentive will ensure the home-buying process runs smoothly.

  1. Builder Reputation

Before accepting any incentive, do your research on the builder. You want to avoid accepting an incentive from a builder who cuts corners or provides poor crafts.

  1. Resale Value

Finally, consider the impact of accepting a builder incentive on the resale value of your home. While incentives can be appealing in the short term, they may only sometimes add value to your home in the long run. 


Amy Bonis, a Realtor in Los Angeles, says, “Builder incentives can definitely be worth considering. They can provide significant financial benefits and other perks that can make buying a new home much easier and more enjoyable for buyers. Book your appointment now with Amy Bonis to get your own home!

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