Mortgage Rate Buy-Downs: The Real Estate Affordability Hack You Should Know

Learn how fixed-rate and temporary mortgage buy-downs can lower your monthly payments. See which option fits your goals and how to negotiate for bigger savings.

A real estate affordability hack worth knowing

My clients have been securing lower monthly payments on their new homes. How? We’re negotiating mortgage rate buy-downs. 

A FIXED-RATE buy-down is when extra money is paid up front to permanently lower your mortgage interest rate for the entire life of the loan. (It's like pre-paying some interest to get a better rate forever.) 

A TEMPORARY buy-down is when extra money is paid up front to reduce your interest rate for the first few years of your mortgage. 

Want to know which option could work for you?

Choose a fixed-rate buy-down if you:

• Plan to keep your house long-term
• Don't expect to refinance soon (because rates are not likely to drop).
• Want permanent savings
• Have extra cash at closing

Choose a temporary buy-down if:

• You expect to refinance soon (because you think rates are likely to drop).
• The seller or lender is open to negotiating
• You want lower payments, immediately 
  
  

Bottom line? Ask us about buy-downs - it's something that can help you negotiate with the seller or lender, which can significantly lower your monthly mortgage payment.

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