General Mortgage Knowledge · 20% of the SAFE exammedium
Correct answer: No — a seller-paid buydown is a legitimate seller concession, not a RESPA violation
Seller-paid buydowns are PERMITTED and common in real estate. They are seller concessions — the seller helps the buyer afford the loan. This is NOT a RESPA Section 8 kickback. RESPA prohibits hidden payments for referrals that create conflicts of interest (like paying a real estate agent to steer buyers to a specific lender). A buydown is transparent: it appears on the purchase agreement and Closing Disclosure. However, seller concessions are subject to loan program limits (e.g., 3-9% of purchase price depending on loan type and LTV).
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