Seller Concessions Explained: What Buyers Can Ask For in Dallas (and What Sellers Should Expect)

by Kelly Reber

Seller Concessions Explained: What Buyers Can Ask For in Dallas (and What Sellers Should Expect)

If you're buying or selling a home in Dallas, Richardson, Plano, Allen, or Frisco, one question comes up constantly right now:

“Can the seller help with closing costs?”

The short answer? Yes.
The better answer? It depends on the loan type, down payment, and strategy.

Let’s break it down in a way that actually makes sense so you can use this to your advantage whether you’re buying or selling in today’s North Dallas market.

What Are Seller Concessions (and Why They Matter Right Now)

Seller concessions are costs the seller agrees to pay on behalf of the buyer, most commonly:

Closing costs
Prepaid taxes and insurance
Discount points (to buy down the interest rate)

In a market like we’re seeing across Dallas and Collin County, where inventory is higher and buyers have more leverage, concessions are becoming a key negotiation tool.

But there are rules and they vary depending on the loan.

Conventional Loans: The Most Common Scenario

For buyers using a conventional loan (which is most of the market), seller concessions are capped based on the down payment:

Primary or Secondary Homes:

Less than 10% down → up to 3%
10% to 25% down → up to 6%
More than 25% down → up to 9%

Investment Properties:

15% down or more → up to 2%

👉 Translation in real life:
A buyer putting 5% down on a $500,000 home can ask for up to $15,000 in concessions.

FHA Loans: Flexible and Buyer-Friendly

FHA loans are popular with first-time buyers and allow:

As little as 3.5% down
Up to 6% in seller concessions

This 6% can cover:

Closing costs
Prepaids
Discount points

👉 Why this matters:
FHA buyers can often structure deals where they bring significantly less cash to closing, which can open doors for more buyers in North Dallas.

VA Loans: The Most Misunderstood (and Powerful)

VA loans come with some of the most flexible concession structures:

No minimum down payment
No cap on normal closing costs a seller can pay
4% cap on “extras” (concessions) like:
- Debt payoff
- Appliances
- VA funding fee

Discount points also fall under a 4% guideline depending on how they’re structured.

👉 Key takeaway:
Sellers can cover all standard closing costs for VA buyers, and the 4% cap only applies to non-traditional extras.

This is a huge advantage for VA buyers and something sellers should understand before rejecting an offer.

USDA Loans: Similar to FHA

For USDA loans (more common in outer areas around North Texas):

No down payment required
Up to 6% in seller concessions

These function very similarly to FHA when it comes to negotiation strategy.

How This Plays Out in the Dallas Market

Here’s what I’m seeing right now across North Dallas:

For Buyers:

You may not need as much cash as you think
Structuring concessions can be more powerful than negotiating price
Rate buydowns using seller credits are becoming very common

For Sellers:

Offering concessions can expand your buyer pool significantly
Sometimes giving 3–6% in concessions nets you more than a price reduction would
It’s not about “giving money away” it’s about getting the deal done efficiently