🏡 The Lending Letter

Saturday Edition: Let's Make the Seller Pay for It 😏

Happy Saturday! 🌤️ Markets are closed, rates are chilling, and you've got a full weekend to actually learn something that could save you real money at the closing table. Today we're unpacking one of the most underused negotiating tools in real estate — seller concessions — and why so many buyers leave thousands of dollars on the table by not asking for them. Plus, a personal finance hack that the IRS practically begs you to use but most people still ignore. Let's go. 🚀

🔒 Steady As She Goes — Weekend Lock-In

6.04% for the third straight day. Rates don't move on weekends — bond markets are closed Saturday and Sunday — so this number is locked in until Monday morning. Think of it as a two-day rate vacation. ⛱️

On a $450,000 loan, 6.04% puts your principal & interest payment at roughly $2,713/month. That's the reality right now, and the next thing that could move it is the PCE inflation report on February 27 — the Fed's preferred inflation gauge. If PCE comes in hot, expect rates to tick up. Cool reading? Maybe some relief heading into March. Worth watching.

🔗 Rates stable and you're ready to move? Whether it's a primary residence or any property, or you're specifically eyeing an investment property, fill out a quick form and we'll get you connected.

🤝 Today's Deep Dive: Seller Concessions — The Art of Getting the Seller to Pay Your Closing Costs

Here's an open secret in real estate: closing costs are negotiable. And one of the most powerful ways to reduce what you bring to the table at closing is by negotiating seller concessions — essentially getting the seller to cover some or all of your closing costs as part of the deal. 💡

Most buyers focus obsessively on the purchase price and forget entirely that closing costs typically run 2–5% of the loan amount. On a $400,000 purchase, that's $8,000–$20,000 due at closing, on top of your down payment. That's not chump change. Per the Consumer Financial Protection Bureau, closing costs include lender fees, title insurance, appraisal, prepaid interest, homeowner's insurance, and escrow setup — and they add up fast.

💰 Real Numbers: What This Actually Looks Like

📏 The Limits: How Much Can Sellers Actually Concede?

Here's where it gets specific — every loan type has caps on how much sellers can contribute. Exceed these and your lender will reject the concession (yes, you can get TOO generous and it creates problems). According to Bankrate's seller concessions guide:

🏦 Conventional Loans (Fannie Mae / Freddie Mac):

Concession limits depend on your down payment: put down less than 10% → seller can contribute up to 3%. Down payment of 10–24% → up to 6%. Down 25%+ → up to 9%. The more equity you bring, the more flexibility the seller has to help.

🏛️ FHA Loans:

Seller can contribute up to 6% of the purchase price toward buyer's closing costs. FHA is generous here, which is one reason it's popular with first-time buyers who need cash-flow flexibility. 🙌

🎖️ VA Loans:

The VA allows seller concessions up to 4% of the loan amount for certain items (like paying off the buyer's debts, prepaid taxes, etc.) PLUS unlimited contributions toward normal closing costs. Veterans: use this. It's one of the best deals in lending.

🌾 USDA Loans:

Seller concessions capped at 6% of the sales price. Similar to FHA in terms of flexibility. Good for rural/suburban properties that qualify.

🎯 When Do Seller Concessions Actually Work?

Not every market is concession-friendly. In a red-hot seller's market with 10 offers on day one, asking for concessions might get your offer tossed. But right now? We're in a more balanced market, and sellers in many regions are willing to negotiate — especially on homes that have been sitting for 30+ days. 🏘️

✅ Best situations for requesting concessions:

Days on market: 30+ (seller is motivated). New construction: builders LOVE offering concessions instead of price drops (it protects their comps for future sales). Rate buydowns: instead of cash at closing, ask the seller to fund a 2-1 buydown. Off-peak season (winter, mid-summer): fewer competing buyers.

⚠️ Watch out for this trap:

Some buyers inflate the purchase price to "create room" for concessions. Lenders will sniff this out. The appraisal must support the purchase price — if your inflated offer doesn't appraise, the deal falls apart. Always negotiate concessions within appraised value territory.

💬 How to Actually Ask for Concessions Without Offending the Seller

It's all in the framing. "We'd like $8,000 back" sounds greedy. "We'd like to offer $388,000 with $8,000 in seller credits toward closing costs" sounds like a clean deal. Same math, totally different vibe. Your agent's job is to frame this right — and if they're not even bringing it up, ask them directly: "What concessions are standard in this market right now?" 🧠

🧠 Money Hack: The HSA — The Only Account That's Triple Tax-Free (And Most People Are Wasting It)

Forget the regular "max your 401k" advice for a second. There's a lesser-known account that beats even a Roth IRA in one very specific way — and the majority of Americans who qualify for it aren't using it strategically. It's called a Health Savings Account (HSA), and when used correctly, it's the closest thing to a legally-sanctioned tax cheat code. 🎮

🔢 The Triple Tax Advantage — Explained Simply

Tax Break #1: Contributions go in pre-tax 💰

Money you put into an HSA reduces your taxable income — just like a 401k. In 2026, you can contribute up to $4,300 if you have self-only coverage or $8,550 for a family plan (plus a $1,000 catch-up if you're 55+). For someone in the 22% tax bracket, maxing a family HSA saves $1,881 in federal taxes alone. Per the IRS HSA publication, these limits are adjusted annually for inflation.

Tax Break #2: Growth is tax-free 📈

Most people dump their HSA money into a default cash/savings account inside the HSA platform — and it earns basically nothing. The move? Invest it. Most major HSA providers (Fidelity, HSA Bank, HealthEquity) let you invest your HSA balance in index funds. The growth — dividends, capital gains, all of it — is 100% tax-free. Forever. Same as a Roth IRA.

Tax Break #3: Tax-free withdrawals for medical expenses 🏥

Withdraw money for any qualified medical expense — doctor visits, prescriptions, dental, vision, even some fitness expenses — and you pay zero taxes. No other account does this. Not your 401k. Not even a Roth IRA (which taxes non-qualified withdrawals). HSA wins on healthcare spending, period.

⚠️ The Catch: You Need a High-Deductible Health Plan (HDHP)

HSAs are only available if your health insurance qualifies as an HDHP — meaning at least a $1,650 individual/$3,300 family deductible in 2026. If your employer offers HDHP + HSA as an option, and you're generally healthy? This combination almost always wins mathematically over a lower-deductible plan, especially when you factor in the tax savings on contributions. Run the numbers before open enrollment next time. 📊

Bonus at 65: After 65, you can withdraw HSA funds for ANY reason (not just medical) with no penalty — you just pay ordinary income tax, like a traditional IRA. So worst case, you've built a backup retirement account. Best case, you're sitting on a tax-free healthcare fortress. 🏰

🏖️ For STR Owners: Spring Booking Season Is Starting RIGHT NOW

If you run an Airbnb or short-term rental, February might feel slow — but here's what the data shows: spring travelers start booking in February. March, April, and Memorial Day weekend bookings are actively being made right now, and you want to be front of mind (and front of search results) when they're clicking. 📅

🎯 This weekend's STR to-do list:

Update your listing photos for spring. If your photos show the same cozy winter fireplace vibes, swap in some brighter, lighter shots. Travelers booking spring getaways want to imagine sun and warmth, not blankets. If you don't have spring photos, shoot them now before the season hits. 📸

Audit your pricing for spring breaks. Spring break dates vary by school district — some hit in mid-March, others in April. Map your market's local school calendars and price premium weekends NOW before your competitors do. Even a 15% rate bump on peak spring weekends adds up to thousands in extra revenue. 💰

Review your amenity list. Is there anything missing that spring travelers want? A grill? Outdoor seating? Bikes? These aren't just nice-to-haves — they show up in Airbnb search filters. A guest who filters for "outdoor space" won't even see your listing if you haven't tagged it properly. If you want to fund new amenities with 0% interest, we have a partner for exactly that. 🪑

📋 Weekend Homework (Pick Your Player)

📆 What's Ahead: Key Dates to Watch

Markets reopen Monday, and the week ahead has some important data that could nudge rates:

📊 February 27 — PCE Inflation Report: The Fed's preferred inflation metric. This is THE report to watch. A hotter-than-expected reading could push rates higher. A soft reading could give the market a reason to cheer. Either way, we'll break it down in Monday's edition.

🏠 February 25 — New Home Sales: We'll get January's new home sales data, which gives us a pulse on builder activity and housing demand heading into spring.

Rates have been remarkably stable in the 6.04–6.19% range lately, but that stability won't last forever. End of February could get interesting. We'll keep you posted, daily. 📬

🎯 Today's Bottom Line

Two powerful tools, one edition. Seller concessions can meaningfully reduce your closing costs if you know how to ask for them — and the limits by loan type are something every buyer should memorize before making offers. HSAs are a legitimately triple-tax-advantaged retirement vehicle that most people let sit idle in a cash account.

Neither of these requires special connections, insider access, or luck. They just require knowing the rules and being deliberate. And that's exactly what this newsletter is here for. 💪

Enjoy the rest of your Saturday — we'll see you Monday with fresh rate data and whatever the market has in store for us. 🌟