What are the maximum seller-paid closing costs for FHA/USDA loans?

The maximum seller-paid closing costs for FHA and USDA loans is set at 6% of the purchase price. This guideline allows sellers to contribute a significant amount toward the buyer's closing costs, which can help make the transaction more affordable for homebuyers. By permitting a 6% contribution, these loan programs support increased accessibility to homeownership, particularly for first-time buyers who may have limited funds available for upfront expenses.

This feature can be beneficial as it reduces the cash burden on buyers at closing, allowing them to allocate their savings toward down payments or reserves instead. Understanding this percentage is crucial for mortgage professionals when structuring deals and advising clients on their financial options during the home buying process.