Builder incentives do not automatically establish a resale home’s value. Compare the actual package, financing terms and comparable-sale adjustments, not just the advertised price.
Reviewed and corrected October 5, 2026. Original publication date retained.
Identify exactly what the incentive buys
Ask for written terms showing the eligible home, closing deadline, required lender or service provider, loan program and whether the offer covers closing costs, a temporary subsidy, permanent points or non-realty items. Do not treat an advertised dollar amount as unrestricted cash.
Apply the loan limits
Fannie Mae’s interested-party contribution rules limits Fannie Mae financing concessions based on LTV/CLTV and the lower of purchase price or appraised value. For a principal residence or second home, limits are 3% above 90% LTV/CLTV, 6% at 75.01%–90%, and 9% at 75% or below. Investment properties have a 2% limit.
A clearly hypothetical cap example
At a hypothetical $500,000 purchase and equal appraisal, a 95% LTV/CLTV transaction falls in the 3% tier, or $15,000. A $20,000 incentive is not automatically a usable $20,000 financing credit. The lender must identify what is permitted and how any excess is classified.
Compare resale value independently
Fannie Mae’s comparable-sale adjustment guidance requires market-based treatment of concessions in comparable sales. A builder’s recorded price may reflect incentives; a credit does not automatically preserve the real estate’s value. Review finished homes, condition, lot characteristics and the actual terms behind comparable transactions.
Frequently Asked Questions
Can I use the entire advertised credit?
Only if the loan rules, actual eligible costs and written offer permit it.
Do incentives always reduce resale values?
No universal conclusion follows from an incentive. Evaluate the relevant comparable sales and market reaction.
Talk with our team
Contact MVP Home Group to discuss the property and the next step that fits your plans. For legal, tax, loan or insurance questions, obtain advice from the appropriate qualified professional.
About MVP Home Group
Nelson Cruz, P.A. is the Founder & CEO of MVP Home Group, brokered by Real Broker LLC. He brings nearly two decades in law enforcement to his work in real estate. Contact our team through Nelson’s profile.