Max Closing Costs Allowed to be Paid by Seller

[Account Closed]

Hi all -

The mortgage agent who approved me for a conventional mortgage and agreed to have the the mortgage underwritten (he is not the actual underwriter) for a close next week on a rental property just came back to me today to say that he "didn't know that the seller couldn't cover more than 2% of closing costs."

On my current, signed contract, the seller agreed to a flooring allowance equal to 3.7% of the purchase price and closing coverage equal to 4.5% of the sale price.  Are repair allowances treated the same as closing costs?  Can I receive only 2% from the seller total (allowances and closing costs combined)?

Both the property and I are located in Virginia.  The mortgage agent says he won't be able to get me an answer until Wednesday (due to tomorrow being a bank holiday), so my agent and I are trying to prep for contract changes that will minimize the amount of money I need for close and repairs, and maintain the amount the seller is receiving.

[Albert Bui]

Originally posted by @Brie Schmidt:

I thought the max closing costs were 3%

@Albert Bui might know....

 The maximum allowed concessions on conventional is 3% if the borrower puts down Less than 10%, 10% to 24.99% it's 6% max concession and 9% concession max when down payment is 25% or higher on primary residences.

On non owner properties it max 2% no matter what.