If you're buying a home and thinking of asking the seller to help cover your closing costs — great idea. But there’s a limit to how much they can actually contribute.
Let’s break down what’s allowed based on the type of loan you're using: FHA, VA, or Conventional.
🟢 First — What Are Seller Concessions?
Seller concessions are when the seller agrees to pay for part (or all) of your closing costs — things like:
- Loan origination fees
- Title insurance
- Appraisal fees
- Property taxes or insurance escrows
- Discount points (to lower your rate)
💡 These concessions can help reduce the cash you need to close — which is a big win for many buyers, especially first-timers.
📊 How Much Can the Seller Contribute?
Loan Type
Maximum Seller Contribution
FHA
Up to 6% of the home’s sale price
VA
Up to 4%, plus customary closing costs
Conventional
Depends on your down payment:
– 3–9% down: up to 3%
– 10–25% down: up to 6%
– 25%+ down: up to 9%
🧠 Important Notes
- Seller concessions cannot be used for your down payment, only closing costs and allowable fees.
- You must negotiate this as part of your offer — it must be agreed to in writing before closing.
- If your total closing costs are less than the max allowed, the leftover amount can’t go in your pocket — it just goes unused.
📍 Southern California Tip
In competitive areas like Temecula, Murrieta, Oceanside, or Vista, seller concessions are often negotiable — but not always guaranteed.
That’s why having a strong buyer’s agent (like me!) helps you structure a winning offer that includes both price and perks.
🤝 Final Word
Whether you're going with FHA, VA, or Conventional financing, knowing your limits — and using them strategically — can save you thousands at closing.
Want help writing an offer that includes seller concessions?
📲 Let's talk through your numbers and options.–
Andrew Georgitsis