What happens in a seller denies paying concessions on an FHA loan?

Asked by Jessicalgenaw, Clawson, MI Wed Oct 10, 2012

Am I then responsible for coming up with the remaining closing costs out of pocket, or is there a way to roll it in to the loan? I cannot afford to pay much more than the 3.5% down at this time.

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Trevor Curran, Mortgage Broker Or Lender, Great Neck, NY
Thu Oct 11, 2012
Good morning Jessica,

Unfortunately if the Seller refuses to agree to include a Seller's concession there's not much else you can do unless your Lender can give you a credit for some/all of the closing costs. Here in New York with closing costs being so ridiculously high, it's not always possible for a Lender to give a Borrower a credit for all closing costs.

The Lender credit is based upon the Lender charging you a higher interest rate on your loan. If you are qualified at the higher rate, AND if the Lender credit covers your costs then you may have a solution. The Lender has to agree to do this, also.

Trevor Curran
NMLS #40140
0 votes
Thanks so much to everyone for all the quick and helpful responses. I was able to talk to my lender and it seems like the lender credit option may work for me if the Seller will not meet me at least halfway on the concessions. Thanks again!
Flag Thu Oct 11, 2012
Bill, , Southampton, NY
Wed Oct 10, 2012
FHA automaticaly calculates the maximum loan based on the sales price, if the seller agreed to a seller concession and reneged the deal is off, Otherwise you will have to pay the closing costs and the down payment.
0 votes
Michael Emery, , Minneapolis, MN
Wed Oct 10, 2012
You could roll them into the mortgage. BUT the home will have to appraise for the contract price plus the closing costs. The bank won't lend to you more money than the worth of the home.
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