Max Closing Costs Allowed to be Paid by Seller
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.