I’m Michael DiVita — DRE #01372066 | NMLS #241655, DiVita Home Finance (DRE #01818285 | NMLS #323700), Tiburon, CA. I’ve been in California mortgage lending since 2000 and founded DiVita Home Finance in 2007. Seller concessions are a negotiating tool I use on nearly every California purchase — the right structure can save buyers $20,000–$50,000 at closing or fund a meaningful rate buydown. Call (800) 239-1103.
Seller concessions let you negotiate to have the seller credit money toward your closing costs instead of reducing the purchase price. In a market where closing costs on a $1M+ California home can run $20,000–$30,000, this strategy can be the difference between being able to close or not.
The key: the seller nets about the same either way. You just have less cash walking out of your account at closing.
Seller Concession Limits by Loan Type
| Loan Type | Max Seller Concession |
|---|---|
| Conventional (LTV 90%+) | 3% of purchase price |
| Conventional (LTV 75%–90%) | 6% of purchase price |
| FHA | 6% of purchase price |
| VA | 4% of purchase price (plus all customary costs) |
| USDA | 6% of purchase price |
How to Negotiate Concessions in California’s Market
In a seller’s market, asking for concessions while coming in under list price usually kills the deal. The move that actually works: offer at or slightly above asking, structured with a seller credit. The seller gets the net price they want. You get cash back at closing to cover fees.
In a buyer’s market or on properties sitting longer than 30 days — which happens more often in 2026 than it did in 2022 — you can ask directly without the price premium. Either way, your agent needs to know how to structure the offer, and your lender needs to confirm the concession fits within program limits.
What Seller Concessions Can Cover
- Lender origination fees
- Appraisal and inspection fees
- Title insurance and escrow fees
- Prepaid interest from closing to first payment
- Property tax and insurance impounds
- Discount points — permanently buying down your interest rate
They cannot be used as your down payment. Down payment must come from your own funds, a gift, or an approved assistance program like GSFA Platinum or CalHFA.
Using Concessions to Buy Down Your Rate
This is the most powerful use of seller concessions in the current rate environment. With the 30-year fixed at 6.66%, using a seller credit to buy down to 6.25% or lower can save you $200–$300/month for the life of the loan — far more valuable long-term than a price reduction of the same dollar amount.
On a $900,000 California purchase, one point ($9,000) typically buys the rate down by about 0.25%, saving roughly $141/month over 30 years. If you’re staying 5+ years, the buydown beats holding cash.
Talk to Michael Directly
DiVita Home Finance | Tiburon, CA | In lending since 2000, founded DiVita Home Finance in 2007. Michael DiVita DRE #01372066 | NMLS #241655. Company DRE #01818285 | NMLS #323700.
💬 Text: (310) 849-9124
