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Mortgage Glossary

Seller Concession

Mike Starr·Reviewed August 2026

A seller concession is when the home seller agrees to contribute money toward the buyer's closing costs as part of the purchase agreement. This reduces the cash the buyer needs at closing and can make homeownership more accessible. Concession limits vary by loan type — for example, FHA allows up to 6% of the purchase price, while conventional loans typically cap at 3% for low down payments.