This week’s product message is about seller concession do’s and don’ts-
There is a maximum percentage of sale price cap on seller concessions based on loan type, downpayment and occupancy:
Loan to value 90.01%+=3%
Loan to value 75.01-90%=6%
Loan to value 75% or below=9%
FHA Loans- Max 6% all loan to values
VA Loans – 4% closing costs and points
USDA Loans- No max seller contribution*
Closing costs can be financed up to 100% of appraisal
Non-Owner occupied 2% Max all LTV’s
FNMA Hompath follow standard max
Except up to 6% allowable
with LTV 90%+
*some investors may have an internal policy limiting seller contribution to 6%.
I hope you find this information helpful when negotiating contracts on behalf of your buyers.
I look forward to working with your clients!