Seller Contributions

A realtor called me today with a question regarding maximum seller contributions on an FHA deal.  A seller contribution is a dollar amount or percentage of the purchase price that a seller agrees to contribute towards closing costs, prepaids, and/or points.

Each loan product has its own contribution limit which ranges from 3% to 9% of the purchase price. Below is a seller contribution chart organized by loan product.


Conventional Conforming





LTV 90.01-97%= 3%


LTV 75.01-90%= 6%


LTV ≥ 75%= 9%


The seller may pay all of the buyers closing costs, normal points, and up to 4% concessions. Concessions include prepaids, VA funding fee, payment of extra points for permanent buydowns, and the payoff of credit balances or judgments on behalf of the buyer. No maximum seller concession; but, if they exceed 6%, a comment from the appraiser with respect to the impact to value is required.

It is important that your realtor knows which type of financing you’re receiving so that he/she knows the amount of seller contribution you can request in your offer. If you have any questions about seller contributions and/or getting a mortgage loan in the state of Virginia, please feel free to contact me.


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