For example, say you offer $155,000 for a home. The home appraises for $150,000. If the seller concessions max out at 3%, the seller can contribute up to 3% of $150,000, or $4,500, to help with closing costs. Here are the seller concession limits for some common loans. Conventional Loans

IPC Limits. The table below provides IPC limits for conventional mortgages. IPCs that exceed these limits are considered sales concessions. The property’s sales price must be adjusted downward to reflect the amount of contribution that exceeds the maximum, and the maximum LTV/CLTV ratios must be recalculated using the reduced sales price or appraised value.

 · The buyer can also get up to 3% in seller concessions from Fannie Mae in order to save on closing costs. In order to qualify for this program, there are a few special requirements. First, at least one of the clients on the loan must be a first-time home buyer.

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Sellers also are allowed to pay private mortgage insurance out of the buyer’s "prepaid" costs collected at closing. Fannie Mae and Freddie Mac also limit the amount of money sellers can give as concessions. The maximum contribution for conventional loans is 3 percent of the lesser of the sales price or appraised value, if the buyer’s down.

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30 Year Conventional Rates The 30-year conventional fixed-rate mortgage has long been popular due to its fixed interest rate and lower monthly payments. However, since the interest payments are spread out over 30 years, you’ll pay more interest over the life of the loan than you would on a shorter-term mortgage.

Most lenders, including FHA HUD insured loans, will allow up to 6% in seller concessions. With conventional loans, lenders can place limits on a home buyer’s ability to ask for seller-paid closing costs. These limits can reduce the amount to 3%, or can even completely strip your ability to get any seller concessions at all!

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Seller concessions are often market-dependent. This is true whether you are using an FHA or a conventional loan to buy a house. Consider the difference: In a sellers’ market (where there are many buyers but limited homes available), a buyer might have a hard time persuading the seller to make a concession of this nature.