Temporary Rate Buydown

Mortgage-World.com is an online mortgage broker specializing in temporary rate buydown products.

We have over 20 years experience in the mortgage industry and we are licensed in New Jersey, Connecticut and Florida.

Reduce your monthly payment with our temporary rate buydown program, which gives buyers a lower rate and lower monthly payments for 1-3 years at the start of their loan. The seller or builder provides the savings, so there’s no cost to the buyer.

To speak directly with a loan officer, call 888-958-5382

TEMPORARY RATE BUYDOWN

1-0 Buydown

The 1-0 Temporary Rate Buydown reduces the buyer’s interest rate by 1% for the first year of their loan.

EXAMPLE: $450,000 | Down payment: $90,000 | Loan amount: $360,000 | 30-year fixed rate: 6.5% | Annual percentage rate: 6.619%

temporary rate buydown

1-1 Buydown

The 1-1 Temporary Rate Buydown reduces the buyer’s interest rate by 1% for the first two years of the loan.

EXAMPLE: Sale price: $650,000 | Down payment: $130,000 | Loan amount: $520,000 | 30-year fixed rate: 6.5% | Annual percentage rate: 6.612%

temporary rate buydown

2-1 Buydown

The 2-1 Temporary Rate Buydown reduces the buyer’s interest rate by 2% for the first year of their loan and 1% for the second year.

EXAMPLE: Sales price: $450,000 | Down payment: $90,000 | Loan amount: $360,000 | 30-year fixed rate: 6.5% | Annual percentage rate: 6.619%

temporary rate buydown

3-2-1 Buydown

The 3-2-1 Temporary Rate Buydown reduces the buyer’s interest rate by 3% for the first year of their loan, 2% for the second year, and 1% for the third year.

EXAMPLE: Sale price: $250,000 | Down payment $50,000 | Loan amount $200,000 | 30-year fixed rate: 6.5% | Annual percentage rate: 6.637%

temporary rate buydown

Advantages of a temporary rate buydown

  • Immediate impact

  • Ease into homeownership (helpful for first-time home buyers)

  • Rate protected if rates rise

  • Refinance later if rates drop

How does a temporary rate buydown work?

  • Buyer signs a temporary buydown agreement with Mortgage-World.com

  • Seller or builder funds the buydown with an upfront deposit

  • Amount of seller’s deposit equals the amount of buyer’s savings over the buydown term

  • Deposit held in escrow account

  • Funds paid monthly to lower buyer’s mortgage payment

Good for buyers, sellers, and builders

For sellers considering a price cut

  • Savings for the buyer without lowering the sale price

For builders who want to move inventory

  • An alternative incentive

For buyers stretching their dollars

  • Immediate monthly payment savings

  • Savings for 1, 2, or 3 years

  • A locked rate if rates increase

  • Room to refinance if rates fall

Ready To Take The Next Step?
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Written by: Julia Luis, Loan Officer with Mortgage-World.com, LLC

Julia Luis covers mortgages and the housing market. Before joining Mortgage-World.com, she was a student at the University of Miami.

Temporary Rate Buydown

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