How much seller paid closing costs are allowable?

When writing a purchase offer seller concessions can be a negotiating tool.  Here’s a guide for the maximum allowable for different loan programs.

Program: Conventional (Fannie Mae / Freddie Mac) for owner occupants

1) 25% or more down payment = 9% allowed seller concessions.

2) Less than 25% down and up to 10% down payment = 6% allowed seller concessions.

3) Less than 10% down payment = 3% allowed seller concessions.

Program: FHA

1) 6% maximum seller contribution.

Program: VA

1) 4% closing cost contribution.

For a Conventional loan on a non-owner occupied property the maximum allowable seller concession is 2%

It’s always a great idea to discuss with your loan officer if when situation allows.

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