Maximum Seller Contribution Chart

Fannie/Freddie/FHA/VA/USDA

Maximum Seller Contribution Chart

With all the mortgage rules changes, I know it’s difficult to keep updated on exactly how much money a seller can contribute to helping a client buy a home.  Here’s a handy chart that covers all the loan programs and the percentage the seller can pay.

	FNMA FHLMC	FHA	VA	USDA
Owner Occupied LTV/CLTV 90.01 or greater 75.01 to 90.00 75.00 or less	3% 6% 9%	6% Maximum all loans	4% Closing cost & points Plus up to 4% sales concession Total: 8%	No Seller Contribution Limit* Closing cost can also be financed up to 100% of appraised value.
Non-Owner Occupied	2% Maximum all LTV’s	N/A	N/A	N/A
FNMA Homepath	Follow standard maximum’s with the exception of LTV’s over 90% allow up to 6% concessions	N/A	N/A	N/A

          *Some investors have an internal policy limiting seller contribution to 6%

FHA Changes Effective April 18, 2011

The increase in Annual Mortgage Insurance Premiums for forward mortgage amortization terms is effective for case numbers assigned on or after April 18, 2011.
The new procedures for requesting case numbers are effective on April 18, 2011. Automatic case number cancellation is effective for all case numbers not insured prior to April 18, 2011.

Summary – Increase in the Annual Mortgage Insurance Premium

Given the legislative mandate in section 202 of the National Housing Act for ensuring that FHA’s Mutual Mortgage Insurance Fund (MMIF) remains financially sound, it is imperative that the MMIF is further strengthened to ensure that FHA will continue its historic role of providing a home financing vehicle during periods of economic volatility and its mission of helping underserved borrowers.

The charts below illustrate the 25 basis points (bps) increase in the Annual Mortgage Insurance Premiums. There are no changes to the Upfront Mortgage Insurance Premium (UFMIP). It is anticipated that this increase will have minimal impact on borrowers but will significantly strengthen the capital position of the MMIF.

The increase in the Annual Mortgage Insurance Premiums for forward mortgage amortization terms is effective for case numbers assigned on or after April 18, 2011.