Is it true or false that seller contributions to a contract can exceed 10%?

Seller contributions to a contract, especially in the context of mortgage financing, are typically subject to specific guidelines. In most standard situations, the contributions are capped at 10% of the purchase price. This restriction is in place to prevent sellers from providing excessive concessions that could manipulate the sale price or the perceived value of the property.

Understanding this limit is crucial for both buyers and sellers, as exceeding the 10% contribution could jeopardize the financing process. Lenders often strictly enforce this cap in line with their guidelines to ensure fair assessments of property value and to mitigate risks associated with inflated sale prices.

While there might be rare exceptions in particular circumstances or loan types, the general rule holds, reaffirming that seller contributions exceeding 10% are not permissible under standard contract agreements. This foundation is why the assertion that seller contributions can exceed 10% is considered false.