WTF Are Seller Concessions, and How Do You Actually Ask for Them?

A seller concession is money the seller agrees to put toward your closing costs, paid out as a credit at the closing table — it is not a discount on the home's price. The sale price stays the same on paper; the seller just hands some of their proceeds back to cover part of what you owe to close. If you can afford the monthly payment but the pile of cash due at closing is what's keeping you up at night, this is the lever to pull.

That distinction matters more than it sounds like it should. A price cut and a $10,000 concession can be worth roughly the same amount of money, but they hit you completely differently. A lower price shrinks your loan amount and your monthly payment a little. A concession doesn't touch your loan amount or payment at all — it just means you write a smaller check on closing day, because the seller's contribution is paying down items like your loan origination fee, title insurance, appraisal fee, prepaid property taxes, or points to buy down your rate.

How much can you actually ask for?

This is capped, and the cap depends on your loan type — and for conventional loans, on your down payment too. As of August 14, 2026, here's what each program allows:

  • Conventional (Fannie Mae/Freddie Mac): 3% of the sale price or appraised value (whichever is lower) if you're putting down less than 10%; 6% if you're putting down 10–25%; 9% if you're putting down more than 25%. Investment properties are capped at 2% regardless of down payment, per Fannie Mae's Selling Guide on Interested Party Contributions.
  • FHA: 6% of the sale price, flat, no matter your down payment, per FHA.com's rules on the 6% limit. HUD has floated lowering this in the past, so don't assume it'll stay at 6% forever.
  • VA: Here it gets a little weird. VA loans cap "seller concessions" at 4% of the loan amount, but that 4% only applies to extras like paying off your debt, covering the VA funding fee, prepaying HOA dues, or throwing in furniture. Normal closing costs — origination fees, title insurance, appraisal, attorney fees — aren't counted against that 4% at all and can be paid by the seller without limit, per Veterans United's breakdown of the VA seller concession rule. In practice this makes VA loans the most generous program on paper, and it's a big part of why VA buyers routinely close with little to nothing out of pocket.
  • USDA: Up to 6% of the purchase price or appraised value, per Neighbors Bank's USDA concessions guide.

One rule applies everywhere, no matter the loan type: the concession can never exceed your actual closing costs. You can't negotiate a $15,000 credit against $9,000 in real closing costs and pocket the difference — underwriting doesn't allow "cash back" from a concession. Anything above what you actually owe either gets forfeited or, on some loan types, gets treated as a price reduction that lowers your loan amount instead. If a seller offers more than you need, ask your loan officer where the extra goes before you get excited about it.

When it actually makes sense to ask

Whether asking for a concession is a smart move or a great way to blow up your offer depends almost entirely on the market you're buying in, not on how badly you need the money.

Ask when: - Homes in the area are sitting on the market longer than average. - You're seeing price reductions on comparable listings — sellers already conceding on price are usually more open to conceding elsewhere. - There's minimal or no competing offer activity. - You're already under contract and something came up in inspection — sellers who are emotionally and financially committed to closing are more willing to negotiate at that point than they were on day one.

Think twice when: - Multiple offers are already on the table. Asking for a concession on top of a competitive price can read as "this buyer is stretched thin," which is not the story you want to tell a seller choosing between offers. - Inventory is genuinely tight for the type of home you're after. In that environment, a clean offer with no asks usually beats a higher offer loaded with contingencies and requests.

That second scenario — a seller's market — is where a lot of buyers talk themselves out of asking at all, and that's usually correct. As Rocket Mortgage's guide to seller concessions puts it, the decision often comes down to whether you ask for closing cost help or just make a lower offer, and in a hot market you generally don't get both asks answered favorably.

How to actually ask for one

Concessions get negotiated as part of your purchase offer, not tacked on after the fact — you (or really, your agent) write the request directly into the contract, specifying either a flat dollar amount or a percentage of the sale price the seller will credit toward your closing costs. It goes in alongside your offer price, not as a separate conversation after you're already in contract, unless something comes up during inspection that changes the calculus.

Here's the part that surprises a lot of first-time buyers: concessions are often an easier ask than a price cut, even for an equivalent amount of money. A lower sale price becomes a permanent public record — it's the new comp that every future appraiser, agent, and seller in the neighborhood references when they price the next house. A concession doesn't show up that way. The home still "sold" at full price; the seller just diverted part of their proceeds to your closing bill instead of pocketing it. For a seller weighing two similar offers, one with a price cut and one with an equivalent concession, the concession is often the less painful ego and paperwork hit — which is exactly why it's worth requesting even in offers that are otherwise at or near asking price.

A couple of practical notes before you draft the ask: - Loop in your loan officer before you finalize the number. They'll confirm your loan type's cap and roughly what your closing costs will actually total, so you're not asking for more than underwriting will allow anyway. - Decide with your agent whether the concession request should be framed as "seller pays X% toward closing costs" or a specific dollar figure. Percentage-based asks scale automatically if the final sale price moves during negotiation; flat dollar asks are more predictable for budgeting. - If the market is competitive, consider whether the request is worth the risk of looking like a weaker offer, versus just asking for a small rate buydown from the lender instead.

Bottom line

Seller concessions turn a cash-to-close problem into a "get it written into the offer" problem — but only up to the percentage cap your loan type allows, and never beyond what you actually owe in closing costs. Ask when the market gives you room; hold off when it doesn't. And loop your lender in early, because "the seller offered to cover it" doesn't mean much if the number blows past what your loan program permits.

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