USDA Loans FAQs – Cash Back On Closing

Q:  Can I get cash back at Closing on a USDA loan?

A:  The borrowers may not receive any cash back at closing on usda loans, other than the documented amount representing costs paid in advance by the borrower from their personal funds (i.e., earnest money deposit, appraisal, credit report fees). Tax pro-rations may not be given to the borrowers in the form of cash back at closing. Any tax pro-rations resulting in cash back to the borrower must be applied as a principal reduction. The same applies to any excess funds remaining from seller paid concessions.

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