my purchase agreement indicates seller pay up to 3% of buyer's closing cost. Is that 3% of purchase price?

Question

I am the seller. in the buyer's purchase agreement it indicates seller pay up to 3% of buyer's closing cost including prepaid. Is that 3% of purchase price? my agent told me at time of signing its 3% of closing cost. 
now its closing soon the title company calculates 3% of purchase price. what can I do?

Vincent Gallo · Answer

Don’t close until it’s corrected.

Seril L Grossfeld · Answer

It depends on the language in the contract not what your real estate agent told you.  3% of the buyer's closing cost is probably are fairly small amount, most of the time these credits relate to purchase price.  If you don't already have an attorney you should probably take your contract and have it reviewed for the correct meaning.

Richard Paul Zaretsky · Answer

Traditionally and customarily it would be 3% of the purchase price.  Proper wording would have been "Seller shall Buyer's closing costs up to 3% of the purchase price".   
 
The language you have is probably a mistake and if you think it is 3% of the closing costs, then you and buyer probably did not have a "meeting of the minds" on a material aspect of the closing.  The language although perhaps wrong, is not ambiguous - it says what it says.  If it is indeed 3% of closing costs, then if closing costs are for example, $4,000, then 3% is only $120.  That amount is hardly worth the language of the mis-written clause.  So this may be a material error in the contract against the Buyer.   You should have the real estate agents come up with a solution.  But if you cannot as Buyer and Seller come to terms on a solution, this is going to need an attorney on your side.  Selling a property or buying a property without an attorney is not wise in any case.

Q: my purchase agreement indicates seller pay up to 3% of buyer's closing cost. Is that 3% of purchase price?