Seller concessions in Florida: how much a seller can pay toward your closing costs on FHA and conventional loans, and how to ask for a credit on a Broward or Aventura condo
October 31, 2026 · Zach Curtis, REALTOR®, Realty Hub
Short answer: a seller can credit part of your closing costs, but the loan program caps it. Fannie Mae allows 3% when you put less than 10% down, 6% with 10% to 25% down, and 9% with more than 25% down. FHA allows up to 6% of the sales price. Credits can't go toward your down payment, and a credit larger than your actual costs doesn't turn into cash back.
Conventional (Fannie Mae) limits
Fannie Mae calls these "interested party contributions." Interested parties include the seller, builder or developer, real estate agents and their affiliates. The financing concession limits for a principal residence or second home are below (Fannie Mae Selling Guide B3-4.1-02):
| Loan-to-value (CLTV) | Your down payment | Maximum seller-paid financing concessions |
|---|---|---|
| Greater than 90% | Less than 10% | 3% |
| 75.01% to 90% | 10% to just under 25% | 6% |
| 75% or less | 25% or more | 9% |
| Investment property, any LTV | 2% |
The details that matter:
- The percentage is based on the lower of the sales price and the appraised value, not the loan amount.
- Concessions can cover your closing costs and prepaids, and association assessments for up to 12 months after closing.
- They can't be used for your down payment, reserves or minimum contribution.
- Anything over the limit, or over your actual closing costs, is treated as a sales concession and deducted from the price used for underwriting.
- Fees a seller customarily pays under local custom don't count toward the cap.
FHA limits
HUD's handbook lets interested parties contribute up to 6% of the sales price toward your origination fees, other closing costs, prepaid items and discount points (HUD Handbook 4000.1, Update 18). The 6% also covers:
- interest rate buydowns
- the upfront mortgage insurance premium
Contributions above 6%, or above your actual costs, are "inducements to purchase." Those reduce the price used to calculate your loan dollar for dollar, and they can't count toward your required minimum investment. For what FHA's premiums cost, see FHA mortgage insurance vs. PMI.
The VA says closing costs on a VA-backed loan may be paid by the seller (VA: purchase loan). Ask your lender about the VA's own limits; see VA loans for condos.
Second homes and investment condos
If you are buying a seasonal or second-home condo with a conventional loan, Fannie Mae applies the same 3%, 6% and 9% tiers as for a principal residence. If you are buying a unit to rent out, the cap drops to 2% at any loan-to-value. Investment loans can carry different down payment and pricing terms, so ask your lender to quote the occupancy type you will actually certify.
A $350,000 condo example
- Conventional with 5% down: the cap is 3%, or $10,500. If your actual closing costs and prepaids are $9,000, the usable credit is $9,000, since the credit can't exceed your costs.
- Conventional with 10% down: the cap rises to 6%, or $21,000, still limited to your actual costs.
- FHA with 3.5% down: the cap is 6% of the sales price, $21,000, which can include the upfront mortgage insurance premium. Your 3.5% down payment still has to come from you or an acceptable source such as down payment assistance.
Your Loan Estimate and Closing Disclosure show seller credits; see Loan Estimate vs. Closing Disclosure.
How to ask for a credit
- Know your costs first. Get a Loan Estimate and a title quote so you ask for a number you can use. See Broward closing costs and title insurance.
- Price versus credit. A credit lowers your cash to close but not your loan. A lower price can lower both. Your lender can show you each version.
- Condo items. Ask whether an upcoming special assessment will be paid by the seller or credited, and check the estoppel certificate for what's owed. See who pays a special assessment and estoppel certificates. Fannie Mae lets financing concessions cover association assessments for up to 12 months after closing, within the cap.
- Inspection repairs. A repair credit is still a contribution; under FHA rules repair allowances count as inducements. Talk to your lender before agreeing to one. See home inspections.
- Write it into the contract. The credit has to appear in the purchase contract so your lender and closing agent can apply it.
Browse Hallandale Beach, Hollywood, Dania Beach, West Park or Aventura, then start at Ready to buy.
Zach Curtis, Realtor, Realty Hub, license SL3664129. Equal Housing Opportunity. General information, not legal, tax, insurance or lending advice. Your lender applies the limits to your loan.
Questions? Ask Zach
I'm Zach Curtis, a REALTOR® with Realty Hub in Hallandale Beach. I help renters and buyers in Hallandale Beach, Hollywood, Aventura and nearby. Zach replies personally within 15 minutes, 8 AM to 9 PM ET, 7 days. Outside those hours, by 9 AM.
Questions
How much can a seller pay toward closing costs on a conventional loan?
Under Fannie Mae's guide, 3% if your loan-to-value is over 90%, 6% between 75.01% and 90%, and 9% at 75% or less for a principal residence or second home; 2% for investment property.
How much can a seller pay on an FHA loan?
HUD allows interested parties to contribute up to 6% of the sales price toward origination fees, other closing costs, prepaid items and discount points, including the upfront MIP and rate buydowns.
Can seller concessions pay my down payment?
No. Fannie Mae doesn't allow interested party contributions for the down payment, reserves or minimum contribution, and FHA doesn't allow them for the minimum required investment.
What happens if the credit is bigger than my closing costs?
The excess doesn't become cash back. Fannie Mae treats it as a sales concession deducted from the price, and FHA treats it as an inducement that reduces the value used for the loan.
Can a seller credit cover condo association fees?
Fannie Mae allows financing concessions to cover association assessments for up to 12 months after settlement, within the overall cap.
Sources
Published October 31, 2026 by Zach Curtis, REALTOR®, Realty Hub, license SL3664129. General information for South Florida, not legal, tax, insurance or lending advice. Laws, programs and prices change; check the official sources above, and ask a Florida attorney, CPA, insurance agent or lender about your situation. Listing numbers are asking prices and rents from BeachesMLS on the date shown. Equal Housing Opportunity. Zach Curtis and Realty Hub follow federal, Florida and Broward County fair housing law. Every listing is open to everyone. We never steer anyone by race, color, religion, sex, national origin, disability, familial status, age, sexual orientation, gender identity, or any other protected class.