Mortgage Rates
What is a temporary rate buydown?
Answered by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker
A temporary rate buydown lowers your interest rate for the first one, two, or three years before it rises to the full note rate. Common versions are the 2-1 and 3-2-1 buydowns, usually funded by the seller or builder.
It reduces your early payments and gives you room to refinance if rates drop. Unlike permanent points, the savings are front-loaded. We'll show whether a temporary or permanent buydown saves you more.
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