Yes. A seller can often pay some or all of a buyer’s eligible closing costs when the contract and loan program allow it. For many Fannie Mae conventional loans, maximum financing concessions range from 3% to 9% for a primary residence or second home based on loan-to-value, while investment properties are generally limited to 2%. FHA permits interested-party contributions up to 6% of the sales price. VA distinguishes ordinary closing-cost credits from seller concessions: VA does not cap credits for eligible closing costs, but seller concessions are limited to 4% of the home’s reasonable value.
What matters most
- The percentage is a ceiling, not an automatic credit. The seller must agree to it in the contract.
- The credit cannot exceed the buyer’s eligible costs, and unused funds generally do not become cash back to the buyer.
- Conventional, FHA, VA, USDA, jumbo, and non-QM programs define eligible costs and concessions differently.
How to use this answer
Start with a realistic estimate of closing costs and prepaid expenses before writing the offer. Asking for the maximum percentage when the buyer cannot use it may weaken the offer without creating extra benefit. The lender and Realtor should review the requested credit together so the contract language matches the financing plan.
A simple example
If a buyer has $9,000 in eligible closing costs and the contract provides a $12,000 seller credit, the extra $3,000 usually cannot be handed to the buyer. Depending on timing and program rules, the team may be able to use part of the credit for eligible discount points or a temporary buydown, or the contract may need to be renegotiated.
| Program | General limit | What to verify |
|---|---|---|
| Conventional | Generally 3% to 9% for a primary residence or second home based on loan-to-value; generally 2% for investment property | Occupancy, loan-to-value, eligible costs, and current agency rules |
| FHA | Up to 6% of the sales price | Eligible costs, inducements to purchase, appraisal, and current FHA rules |
| VA | Seller concessions are limited to 4% of reasonable value; eligible ordinary closing-cost credits are treated separately | Which items are concessions, reasonable value, and eligible costs |
| USDA | Program and lender rules control | Eligible costs, appraised value, contract, and current USDA guidance |
What to review before you decide
- Confirm the loan program, occupancy, property type, and timeline.
- Review the complete payment and cash-to-close estimate, not one number in isolation.
- Verify current program rules and lender requirements before moving money or signing a contract.
Frequently asked questions
Questions readers often ask next.
Can the seller pay my down payment?
Usually not through a standard seller credit. Down-payment funds must come from an eligible source, such as the borrower, an allowable gift, or an approved assistance program.
Can a seller credit pay for discount points?
Often, yes, when the program allows it and the total interested-party contribution remains within the applicable limit.
Does a seller credit change the appraisal?
The appraiser must know about concessions. Excessive concessions or a price unsupported by the market can affect how the transaction is analyzed.
Sources
Sources used for this article.
- Interested Party Contributions — Fannie Mae Selling Guide • Accessed August 17, 2026
- What costs can a seller or interested party pay? — U.S. Department of Housing and Urban Development • Accessed August 17, 2026
- VA funding fee and loan closing costs — U.S. Department of Veterans Affairs • Accessed August 17, 2026
- Loan Estimate explainer — Consumer Financial Protection Bureau • Accessed August 17, 2026
