What does "credit to the buyer/seller" typically mean in a real estate transaction?

In a real estate transaction, the phrase "credit to the buyer/seller" usually refers to money that is being returned to the buyer as part of the closing costs or as a concession negotiated during the sale. This credit allows the buyer to cover certain expenses or fees associated with the purchase of the property, effectively reducing the amount of cash the buyer needs to bring to the closing table.

For instance, if a seller agrees to cover a portion of the buyer’s closing costs as part of the negotiations, this amount would be credited to the buyer. This practice can make a property more attractive to potential buyers who may be concerned about out-of-pocket expenses. In this context, the focus is on the financial relief or assistance the buyer receives during the transaction.

Other options do not fit this context as accurately. Money received from the bank generally refers to loans or financing, which does not correspond to credits in a transaction. A fee charged to the buyer would imply an additional cost rather than a benefit, while an adjustment in the sale price refers to changes made to the overall price of the property rather than the specific financial assistance provided directly to the buyer through credits.