What does "Seller concessions" mean?

A seller's concession can be a good idea as it helps buyers reduce their out-of-pocket closing costs, making the purchase more affordable. Concessions can range from 3% to 6% of the home's sale price, depending on the type of loan and negotiation terms. However, buyers should consider how this affects the overall sale price and their financing options.

The maximum seller concession for a conventional mortgage is 3% of the purchase price if the buyer is making a down payment of less than 10%. For a down payment of 10% to 25%, the maximum is 6%. If the down payment is 25% or more, the maximum concession increases to 9%.

Seller concessions in a mortgage refer to when a seller agrees to cover a portion of the buyer's closing costs, making the purchase more appealing. This can include specific amounts, such as up to 3% to 6% of the home's sale price, depending on the type of loan.

Sellers often pay concessions, with about 30% of home sales including them. This practice is commonly used to attract buyers and can help cover closing costs, making the transaction more appealing. The amount of concessions can vary significantly, but they typically range from 3% to 6% of the home's sale price.