The seller-contribution cap by loan type
Each cap is an estimate and general information, with its primary source linked. The cap limits concessions; standard closing costs are a separate lane.
| Loan type | Seller cap | Measured against | Key nuance |
|---|---|---|---|
| Conventional (Fannie Mae / Freddie Mac) | 2% to 9% Fannie Mae: source | property value | The cap rises as your down payment grows, from 3% to 9%. |
| FHA | 6% HUD / FHA: source | lesser of sales price or appraised value | Concessions cannot cover your minimum required investment (the 3.5% down). |
| USDA Guaranteed (Rural Development) | 6% USDA Rural Development: source | sales price | Several big items do not count, so the effective help is often larger. |
| VA | 4% U.S. Department of Veterans Affairs: source | established reasonable value (Notice of Value) | The 4% covers concessions only; standard closing costs are a separate, uncapped lane. Full VA breakdown → |
| Jumbo / Non-QM / Bank Statement | No standard cap | Investor and program specific | No agency-standardized cap; limits are investor and program specific. |
Sourced per row (links above). Figures reviewed June 13, 2026; estimates, not a commitment to lend or a quote of any rate or term.
What is a seller concession, and how is it different from seller-paid closing costs?
A seller concession is an extra the seller is not customarily required to provide: paying your prepaid taxes, funding a rate buydown, or covering part of your closing costs. It is what the program's percentage cap limits. Standard, customary closing costs are a separate lane that mostly does not count against the cap. That distinction is the whole game.
How much can the seller pay on a conventional loan?
The conventional cap scales with your down payment: 3% when you put less than 10% down, 6% from 10% up to 25% down, and 9% with 25% or more down. Investment properties are capped at 2%. It is measured on the lesser of the sales price or appraised value.
| Occupancy | Down payment / LTV | Cap |
|---|---|---|
| Primary or second home | Over 90% | 3% |
| Primary or second home | 75.01% to 90% | 6% |
| Primary or second home | 75% or less | 9% |
| Investment property | Any | 2% |
Source: Fannie Mae Selling Guide B3-4.1-02 (Freddie Mac parallel: Guide 5501.5). As of June 13, 2026.
Two rules buyers miss: financing concessions cannot exceed your total closing costs, and any excess is treated as a sales concession that reduces value for the loan-to-value calculation. And an interested-party-funded rate buydown must be counted inside the cap.
How much can the seller pay on an FHA loan?
FHA allows up to 6% of the lesser of the sales price or appraised value, combined from all interested parties. Anything above 6% is treated as an inducement to purchase and reduces the value used to size your loan, dollar for dollar. Concessions cannot cover your minimum required investment, the 3.5% down payment.
Source: HUD Single Family Housing Policy Handbook 4000.1 (inducements to purchase / financing concessions). As of June 13, 2026.
How much can the seller pay on a USDA loan?
USDA caps seller contributions at 6% of the sales price. The effective help is often larger, because several items do not count: lender credits from premium pricing, seller-funded repairs held in escrow, and a seller-paid buyer-agent commission. Single-close construction loans are not subject to the limit.
Source: USDA HB-1-3555, Chapter 6, Paragraph 6.2. As of June 13, 2026.
How much can the seller pay on a VA loan?
The VA caps concessions at 4% of the appraised reasonable value, but that 4% covers only concessions like the funding fee, prepaids, and a temporary buydown. Standard closing costs are a separate, uncapped lane, so a seller can often give far more than 4%. A blanket 4%-on-everything cap is a lender overlay, not a VA rule.
Read the full VA seller concessions breakdown →
Source: VA Lender's Handbook, Pamphlet 26-7, Chapter 8. As of June 13, 2026.
What about jumbo and bank-statement loans?
There is no agency-standardized cap on jumbo, non-QM, or bank-statement loans. The limit is set by the individual investor and program, so it varies. Rather than guess at a number, confirm your specific program's seller-contribution limit with your lender before you write the offer. Saying this plainly beats a fabricated figure.
Can the seller pay my real estate agent's commission?
Yes, and it is handled cleanly. Since the 2024 NAR settlement, a seller-paid buyer-agent commission paid in line with local custom sits outside the concession cap under all five programs, so it does not eat into your other seller help. Clarify who pays your agent in writing early.
More on this: how real estate commission works.
How do I structure an offer to use this?
Spend in the right order. Apply seller dollars to your standard, customary closing costs first, because that lane is mostly uncapped. Then use the remaining concession room, up to your program's cap, for the extras: prepaids, the funding fee, or a temporary buydown. Your agent writes the dollar amount into the offer.
Frequently asked questions
Key terms
- Seller concession
- An extra the seller is not customarily required to provide, such as paying prepaids, a buydown, or part of your closing costs. This is what the program cap limits.
- Interested party contribution (IPC)
- Money toward your costs from anyone with an interest in the sale (seller, builder, agent, lender). The cap limits IPCs, not standard customary costs.
- Closing costs
- The fees to complete the purchase. Customary closing costs are a separate, mostly uncapped lane from concessions.
- Discount points
- An upfront charge to lower your interest rate. Market-normal points are often outside the cap; above-market points count as a concession.
- Prepaids
- Prepaid taxes, insurance, and interest collected at closing. A seller-paid prepaid is typically a concession.
- Temporary buydown
- An escrow that lowers the payment for the first year or two. An interested-party-funded buydown counts inside the cap.
- VA funding fee
- A one-time VA fee that counts as a concession inside the VA 4%. Disability-exempt veterans pay none.
- Minimum required investment
- The borrower's own required down payment on FHA (3.5%). Concessions cannot cover it.
- Reasonable value (Notice of Value)
- The VA's appraised value, the basis the VA 4% cap is measured against, rather than the sales price.