Seller Concessions

Seller Concessions
(Lender's Handbook, Chapter 8, Topic 5) A seller concession is anything of value added to the transaction by the builder or seller for which the buyer pays nothing additional and which the seller is not customarily expected or required to pay or provide. Seller concessions include but are not limited to the following:
payment of the buyer's VA funding fee prepayment of buyer's property taxes and insurance gifts such as a television set or microwave payment of extra points to provide permanent interest rate buy-down provision of escrowed funds to provide temporary interest rate buy-downs, and payoff of credit balances or judgments on behalf of the buyer Seller concessions do not include: payment of the buyer’s closing costs, or payment of points as appropriate to the market. Example: If the market dictates an interest rate of 7.5% with 2 discount points, the seller's payment of the 2 points would not be a seller concession. If the seller paid 5 points, 3 of these points would be considered a seller concession. Seller concessions or combinations may not exceed 4% of the reasonable value.)