What is the maximum seller contribution to closing costs for conventional loans?

For conventional loans, the maximum seller contribution to closing costs typically falls within the range of 3% to 6% of the purchase price of the home. This percentage may vary based on the borrower's specific financial circumstances, such as their down payment amount and whether the loan is a primary residence or an investment property.

When a seller contributes to closing costs, it can help buyers reduce their upfront expenses, making home purchases more accessible. Understanding the limits on these contributions is crucial for both buyers and sellers in the negotiation process, as it influences overall financial planning during a real estate transaction.

The other choices do not accurately reflect the conventional loan guidelines for seller contributions. Contributions falling below 1% are usually not significant enough to be considered helpful, and claiming there's no limit misrepresents regulatory standards. Additionally, a seller contribution of 7% to 10% is generally excessive and not permitted under conventional loan guidelines. Thus, the 3% to 6% range represents a realistic and established framework for seller contributions in these transactions.