DON’T LET TODAY’S INTEREST RATES KEEP YOU FROM BUYING A HOME
Effective 11/15/2022: We’re expanding our temporary rate buydowns to deliver even bigger savings of up to 3% for our clients. Choose from 3-2-1, 2-1, 1-1 and 1-0 buydowns, available immediately!
Get the extra flexibility with a lower monthly payment with a Temporary Rate Buydown to lower your interest rate at the start of the loan. It’s a great option for almost any borrower, especially those who:
Choose between these seller- or lender-paid 1-, 2- and 3-year Temporary Rate Buydown options:
Here’s an example of the potential savings on a 3-2-1 seller-paid buydown:
Getting concessions from a seller who wants to sell quickly? You might be in the ideal position to use these toward a Temporary Rate Buydown to save on your interest rate at the beginning of your loan, for a more-comfortable mortgage payment.
This 2/1 mortgage rate buydown scenario shows the potential monthly savings.
A temporary buydown allows some of the interest to be prepaid on a fix-rate mortgage in exchange for a discounted interest rate for the first two years of the mortgage, after which the interest rate reverts to the full note rate for the reminder of the loan. This arrangement is typically paid for through funds escrowed by the seller. Since the interest rate is lower during this time, the borrower’s monthly mortgage payments are more affordable.
Temporary buydowns funded by the seller on the following loan programs:
Primary home purchase for FHA, VA, USDA and both primary and secondary home purchase for Conventional programs.
Year 1 – 3% lower than the note rate Year 2 – 2% lower than the note rate Year 3 – 1% lower than the note rate Year 4 - Full note rate
Year 1 – 2% lower than the note rate Year 2 – 1% lower than the note rate Year 3 – Full note rate
Year 1 – 1% lower than the note rate Year 2 – Full note rate
A 2/1 temporary buydown is a temporary reduction below note rate of two percent (2%) during the first year and a reduction below note rate of one (1%) during the second year of the loan, after which the interest rate reverts to the full note rate for the remainder of the loan. The interest rate change from years one to two is automatic and you are not required to requalify for the loan.
For example, a $400,000 30-year loan with a standard interest rate of 5%, the buyer would be expected to pay an interest rate of 3% the first year, 4% the second year and 5% from years 3 – 30.
The buyer would save approximately $8,380 in interest, so the buyer should expect the total cost of the 2-1 buydown to be in that same ballpark.
Get a payment you’re more comfortable with — call us today!