How Seller Credits Can Help You Save Thousands—But This Window May Not Stay Open

How Seller Credits Can Save You Thousands When Buying a Home in 2025

As the real estate market continues to shift in 2025, buyers are gaining a bit more negotiating power—especially in certain price points and neighborhoods. One of the most valuable tools available right now? Seller credits.

These often-overlooked concessions can help you cover your closing costs, reduce your interest rate, or even accomplish both—potentially saving you thousands of dollars up front and over the life of your loan.

At Bridgepoint Funding, we’re seeing more sellers offering credits to attract serious buyers in summer 2025. But this opportunity may not last long.

Let’s break down exactly what seller credits are, how much you can get, how they can be used, and why smart buyers are taking advantage right now.

What Are Seller Credits?

Seller credits, also known as seller concessions, are funds that a home seller agrees to contribute toward the buyer’s closing costs or prepaid expenses at settlement.

These credits don’t reduce the price of the home—they’re simply applied toward the buyer’s costs in escrow. That might include:

• Title and escrow fees
• Lender fees
• Appraisal and credit report
• Property taxes and homeowners insurance
• HOA dues
• Mortgage points for a rate buydown
• Or a combination of the above

Why Are Seller Credits a Big Deal for Buyers in 2025?

Two words: cash flow and affordability.

Seller credits can free up cash that would otherwise be required at closing—money you can keep in savings, use for moving expenses, or invest elsewhere.

Even more powerfully, when used toward a rate buydown, seller credits can help lower your monthly payment—either temporarily or permanently.

With interest rates still higher than in recent years, using seller credits strategically can help you:

✅ Afford more home
✅ Lower your monthly payment
✅ Reduce upfront cash to close
✅ Feel more financially secure

How Much Can You Get in Seller Credits?

The amount of credit a seller can offer is limited based on your loan type, occupancy, and down payment.

Here’s a breakdown:

✅ Conventional Loans (Fannie Mae & Freddie Mac)

• Primary residence or second home:
  • 3% max with less than 10% down
  • 6% max with 10–25% down
  • 9% max with 25%+ down
• Investment properties:
  • 2% max seller contribution

✅ FHA Loans:

• Maximum seller credit is 6% regardless of down payment.

✅ VA Loans:

• Seller can pay all of the buyer’s closing costs plus up to 4% in concessions (can include items like prepaids or even paying off buyer’s debt).

✅ USDA Loans:

• Up to 6% of the loan amount in seller credits.

💡Tip: These are maximums, not guarantees. Whether you get a seller credit depends on negotiation and market conditions.

Seller Credits in Summer 2025: Why Now Is the Time

Right now, in summer 2025, we’re seeing more listings with price reductions, longer days on market, and even seller incentives like closing cost assistance and rate buydown offers.

In the Bay Area and across California, many sellers are open to negotiating because:

• Inventory has increased in certain price ranges
• Buyers are more rate-conscious
• Homes aren’t flying off the market in 3 days anymore

In this type of market, it’s not uncommon for sellers to offer $10,000–$25,000 in credits to get their home sold—especially if the buyer is solid and pre-approved.

But this window won’t stay open forever.

If mortgage rates drop or buyer competition increases (especially this fall), sellers may stop offering these kinds of deals.

How Can Seller Credits Be Used?

Here are three powerful ways buyers are using seller credits right now:

1. Cover Closing Costs

Closing costs typically range from 2% to 5% of the home’s purchase price. On a $700,000 home in the Bay Area, that could be $14,000–$35,000.

Using seller credits, many buyers are able to:

• Avoid draining their savings
• Keep more money for home repairs or upgrades
• Get into the home they want without being “house poor”

2. Buy Down Your Interest Rate

A seller credit can be used to permanently buy down your mortgage rate by paying discount points up front.

Example:

• $15,000 seller credit might reduce your rate by 0.50%
• That could cut your monthly payment by $200–$300/month
• Over 5 years, that’s a $12,000–$18,000 savings

Buydowns can be a smart way to make today’s higher rates more affordable—especially if you plan to stay in the home for several years.

3. Use for a Temporary 2-1 Buydown

A 2-1 buydown lowers your rate by:

• 2% the first year
• 1% the second year
• Back to normal in year 3

This structure gives you lower payments during the first 24 months, which can help you ease into homeownership or wait for rates to drop and refinance.

Sellers often fund these 2-1 buydowns because they help deals close—and they’re often less expensive than a big price cut.

Do Seller Credits Affect Loan Approval?

Sometimes. Your lender needs to make sure:

• The total credits don’t exceed allowable limits
• The credits don’t exceed actual closing costs
• The appraised value supports the purchase price

That’s why it’s important to work with a mortgage broker who understands how to structure these credits effectively.

At Bridgepoint Funding, we help buyers and Realtors craft offers that maximize seller credits without jeopardizing financing.

How to Negotiate Seller Credits Like a Pro

If you want seller credits, here’s how to put yourself in the best position:

✅ Get Fully Pre-Approved

Show sellers you’re serious and fully qualified.

✅ Work With a Skilled Agent

Your real estate agent should understand how to write offers that include credits—and how to position your offer competitively.

✅ Partner With a Knowledgeable Lender

A good mortgage broker (like us!) will help your agent understand what’s allowable and how to structure the offer for maximum benefit.

FAQs About Seller Credits

Q: Can seller credits be used on all loan types?
Yes, but the allowable amount and use varies by loan program. Check with your lender.

Q: Can I use seller credits for my down payment?
No. Credits can only be used toward closing costs and interest rate buydowns—not the actual down payment.

Q: Can seller credits be combined with lender credits or DPA programs?
In many cases, yes! This can create a powerful combo for minimizing your upfront costs.

Final Thoughts: A Unique Window of Opportunity for Summer 2025

In many markets—including here in Pleasant Hill, Contra Costa County, and the broader Bay Area—the summer 2025 real estate market presents a unique window of opportunity.

Seller credits are back on the table, but that may not last if demand picks back up or rates fall.

If you’re thinking about buying, now is the time to:

✔ Explore how seller credits could help you
✔ Work with an experienced mortgage team
✔ Get fully pre-approved and be ready to negotiate smart

Ready to Take Advantage of Seller Credits?

We can help you:

• Get pre-approved
• Calculate how much credit you can use
• Structure your offer for maximum savings
• Lock in the right loan and rate for your goals

📞 Call us at (925) 478-8630 Let’s make the market work in your favor this summer.