“Your Mileage Points May Vary”
Once upon a time, it was (fairly) safe to tell Buyers that the maximum contribution that a Seller could make toward the Buyer’s closing costs was 3%.
No more.
Here’s the current, updated “cheat sheet,” courtesy of Edina Mortgage’s Keith O’Brien:
- FHA is 6% regardless of down payment.
- Conventional is 3% if the down payment is less than 10%, 6% if the down payment is 10% or more but less than 25% and finally, 9% if the down payment is 25% or more
- For jumbo loans, if the down payment is less than 20%, the maximum contribution is 3% and if the down payment is 20% or more, the max is 6%.
- For VA loans, the seller can pay all non-recurring costs and up to 4% for anything else.
- If you are purchasing investment property, the maximum amount that can be paid is simply 2%.
Got all that?
As Minnesotans like to say, ”Uff-dah!”
