Finance
A Texas seller offers to pay the buyer's 'closing costs' as part of the contract negotiation. From a lender's perspective, these seller concessions are:
AUnlimited in amount
BLimited by loan program guidelines (e.g., FHA limits concessions to 6% of the sale price)✓ Correct
CProhibited on all government loans
DRequired to be disclosed only on conventional loans
Explanation
Seller concessions (contributions toward buyer's closing costs) are limited by loan program rules: FHA limits them to 6% of the sales price, VA to 4%, and conventional loans to 2–9% depending on the LTV. Excess concessions must reduce the purchase price.
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