The second parameter is paying for your closing costs and escrows. Either you will pay for these items or the seller will via a closing cost credit. Philadelphia is a relatively expensive city as far as transaction costs are concerned. Factor in 2% of the purchase price for transfer taxes, you need to escrow about 14 months of property taxes, plus account for lender and settlement related fees. Bottom line it is very feasible that you could easily use the full 6% seller contribution to cover these items.
The third and final parameter to consider is what is gained by putting down more money then the minimum deposit to reduce the amount of the loan financed. For example if you were to increase the amount of the down payment by $10k or $17.7k total you would decrease your monthly mortgage payment by approximatly $60 per month. The flip side is that you will have used $10k of your own funds to obtain that payment reduction. Remember either you are paying for your closing cost or the seller is.
If you need a loan analysis based on these various scenarios feel free to contact me at 866.552.5912. I am a licensed Pennsylvania loan officer and a direct lender that specializes in Federal Government backed loans such as FHA
The 6% Seller concession can be used toward your closing costs.($13,200)
You could use $8,700 of the money to pay discount points for a Seller-Funded 3-2-1 Temporary Buydown:
Down Payment: $7,700.00
Amount Financed: $212,300.00
Year 1: at 2% interest rate: Buyer Payment $784.71/month
Year 2: at 3% Payment: $895.07
Year 3 : at 4% Payment: $1013.56
Year 4+ : at 5% Payment: $1,139.67
This allows you to ease into homeownership comfortably and confidently.
If you chose instead to reduce the price by $8,700 with 3.5% down payment, your loan amount would be: $203,904 and your monthly payment would be: $1,094.60.
Good luck with your purchasing decision!
Calculate your payments: http://www.321advantage.com/buyers-calculate-your-rate