Seller Credits

In addition to the down payment, a buyer will pay closing costs in connection with their purchase.

If the combined amount of cash required is more than a buyer is comfortable with, then they may attempt to negotiate a seller credit for some or all of the closing costs.

For example: a sales price of $400,000 with no seller credit is materially similar to a sales price of $410,000 with a $10,000 seller credit.  Your mortgage payment is slightly more because the sales price is higher, but you are able to reduce your cash to close required.

There are maximums to the seller credits, and the caps depend on your loan program and down payment amount.  Please note – the seller credit can never exceed the closing costs!

Conforming Financing:  (Primary and Secondary residences)

Less than 10% down: 3% Seller Credit cap

10%-25% down: 6% Seller Credit cap

25%+ down: 9% Seller Credit cap

Investment property purchase with any level of down payment: 2% Seller Credit cap

FHA Financing: 6% Seller Credit cap

VA Financing: All closing costs may be covered

Jumbo Financing: 3-6% Seller Credit cap for primary or secondary residence (depending on buyer’s finances and loan product), or 2% for investment property