What are the maximum concessions (Seller-paid costs) a buyer can receive from the seller, realtors, and other parties in a real estate transaction?
This is a great question we deal with all the time. There are so many buyers who need help with their cash for closing. Each program has different guidelines, so I will review the guidelines for the three more popular programs:
- Conventional: When a buyer is financing a primary residence or second home the conventional guidelines base the allowable concession on the buyer’s down payment. Buyers who put less than 10% down can receive up to 3% of the sales price in the concessions. With 10% - 24.99% down the concession can go up to 6% and with 25% down or more, can up to 9% of the sales price.
- FHA: This is a little bit more liberal. They allow 6% in contributions with FHA’s minimum down payment of 3.5%.
- VA Loans: They are even more liberal because they will let interested parties pay for all of the Veterans closing costs plus another 4% for other costs related to the transaction. VA allows 100% financing, so they can move in with literally no cash out of their pocket.
IF YOU WOULD LIKE TO TALK TO US ABOUT GETTING IN TO A HOME WITH LITTLE OR NONE OF YOUR OWN MONEY…GIVE ME A CALL.
Steve Jackson
561.602.1258
