How to Get a Seller to Pay Your VA Closing Costs
A VA loan comes with some attractive benefits, like no down payment and lower interest rates compared to other loan options. But while you won’t need to put money down, you might have to cover closing costs.
Closing costs are typical when buying a home and include both lender and third-party fees..
The good news is that you can ask the seller to cover these costs, but there are limits on how much they can contribute.
Check your VA home buying eligibility. Start here (Mar 15th, 2025)What closing costs can a VA buyer ask the seller to cover?
With a VA loan, sellers can often contribute up to 4% of the loan amount toward a buyer’s closing costs.
Depending on how much you owe, this might be enough to cover everything, or you might need to use some of your own money. Closing costs include:
- VA funding fee
The VA funding fee is a one-time charge that helps keep the VA loan program running. Some borrowers may qualify for an exemption, but if you owe this fee, a seller’s contribution can help cover it.
- Loan origination fee & discount points
The loan origination fee is what the lender charges for processing your loan. This is typically 1% of the loan amount. Discount points, on the other hand, are optional fees you can pay upfront to lower your interest rate. On average, each discount point costs 1% of the loan balance and lowers the interest rate by 0.25%.
- Prepaid property taxes & homeowners insurance
If you have an escrow account, your lender requires you to prepay some of your property taxes and homeowners insurance as part of closing.
- Other closing costs (ex. appraisal, title fees)
Appraisal fees cover the cost of determining your home’s value, while title fees ensure that the property can be legally transferred to you. The seller can also cover other standard costs, like the credit report fee and recording fees.
Strategies to get a seller to pay your closing costs
Even though sellers are allowed to contribute up to a certain percentage of your closing costs, that doesn’t mean they will. Still, there’s no harm in asking.
A motivated seller might be willing to cover some of these costs to speed up the sale, especially if they don’t have any other offers on the table.
If you want the seller to pay your closing costs, mention this early in the process. Your real estate agent can put together a competitive offer to increase your chances of getting the property and this contribution.
So if you know you’ll need help with closing costs, you might offer slightly above the asking price to offset the extra expense. Keep in mind, this only works if the home can appraise at this higher amount.
Also, let the seller know that you’re using a VA loan. This can be an incentive since VA loans have a lower risk of falling through. Additionally, when choosing a real estate agent, make sure they’re experienced with VA loans.
You can ask questions like:
- How many VA loan transactions have you handled?
- Are you familiar with VA loan requirements, including appraisal guidelines and seller concessions?
Still, some sellers may hesitate to cover your closing costs. If that’s the case, maybe you can negotiate in other ways. For instance, if the home inspection finds minor issues, instead of asking the seller to fix them, request a closing cost credit instead.
Be mindful, too, that your ability to get closing costs assistance depends on the market.
In a buyer’s market, where there are more homes for sale than buyers, sellers are more likely to offer concessions to attract offers. But in a seller’s market, where competition is high and they have multiple offers, they might not agree to paying these costs.
Check your VA home buying eligibility. Start here (Mar 15th, 2025)When are sellers more likely to cover closing costs?
There are certain situations when sellers are more likely to cover closing costs, making it easier for buyers.
Cooling housing market
A cooling housing market happens when home prices settle down, when there’s fewer buyers, and when homes stay on the market longer. This is due to factors like higher interest rates, economic uncertainties, or an increase in available homes for sale.
During this time, sellers are sometimes open to covering closing costs to attract buyers and sell faster. So if a home has been sitting on the market without much interest, a seller may offer concessions to make their listing more competitive.
Higher-priced homes
Sellers of higher-priced homes are often more willing to cover closing costs, especially if they have a lot of equity in the home.
Since these homes come with a higher price tag, buyers not only face larger monthly payments but also steeper upfront costs—including a bigger down payment.
This can create a financial strain, especially for buyers who struggle to come up with both a down payment and closing costs. To avoid losing a serious buyer, a seller with enough equity may agree to cover closing costs as a way to help the deal go through.
New construction homes
Builders of new construction homes often offer seller-paid closing costs as an incentive.
This is helpful for first-time homebuyers who may not have a lot in savings, and for repeat buyers who don’t have enough proceeds to cover the down payment and closing costs on their next home.
Bottom line
With a VA loan, it’s possible to have the seller cover some or all of your closing costs, but it depends on the market and how you negotiate. Sellers are more likely to agree in a slower market, on higher-priced homes, or with new construction.
Being upfront about your needs and working with a VA experienced real estate agent can make all the difference. For more information on how to put yourself in the best position to save on closing costs, speak with a VA loan expert.
