Can the seller pay FHA closing costs?
Generally, yes. FHA allows seller contributions up to 6% of the sales price toward eligible closing costs, prepaid items and discount points. The credit cannot replace the buyer's required down payment.
What this actually means.
The credit must match allowed costs and be approved by the lender. The buyer cannot receive unused credit as cash back. Other seller-paid items may be treated as an inducement to purchase and can affect the value FHA uses for the loan.
What this looks like on a real file.
Where this can move.
Title and escrow fees, prepaid taxes and insurance, doc stamps, lender fees, seller credits, and lender credits can change the cash needed at closing.
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Educational only. FHA guidelines, lender overlays, rates, fees, and underwriting requirements can change. Final eligibility depends on full underwriting review. Mortgage Expert, Inc. is not affiliated with HUD, FHA, or any government agency.