Did you know when you purchase a home you can ask the seller to help pay your closing costs, prepaid taxes and insurance, and interest?
It’s true! I’ve listed the maximum seller contribution amounts per loan program below…
Program: Conventional (Fannie/Freddie), owner-occupied…
1) 25% or more down payment = 9% allowed seller contribution.
2) Less than 25% down and up to 10% down payment = 6% allowed seller contribution.
3) Less than 10% down payment = 3% allowed seller contribution.
4) Fannie Mae Homepath: less than 25% down = 6% allowed contributions; 25% down or more = 9% allowed contributions.
Program: FHA
1) 6% maximum seller contribution.
Program: VA
1) 4% closing cost contribution.
Program: USDA
1) No limit to how much sellers can contribute (is limited by actual closing costs/prepaids). When a home appraises higher than the sales price, closing costs can be financed with USDA rural loans up to the difference between the sales price and appraised value.
That’s it for today!
Have a good day today! …and thanks for reading.
Brett
