If the seller is agreeing to give a percentage of the purchase price toward closing costs, is that required to be listed on LE? If so, what happens if the purchase price goes down and we have stated a certain amount on LE because isn't a seller credit 0%?

A seller credit would be reflected as such on the LE. The seller credit is not tied to a tolerance.

So it could fluctuate through out the process then?

Correct, mdog76. A lender credit is treated as a negative closing cost and if it goes DOWN from the LE (except when involved in the pricing) it's treated as a cost increase under the 0% tolerance rules. But a seller credit is not subject to tolerance rules (the costs it pays for may be, however).