Basics of Rate Buydowns Q: What is a temporary rate buydown? A: A temporary rate buydown is a financing option that reduces your initial mortgage interest rate for the first one or two years of your loan. At The Mortgage Planner, we offer both 1/0 and 2/1 buydown options to help you manage your initial mortgage payments more effectively.
Q: What's the difference between 1/0 and 2/1 buydowns? A: With a 1/0 buydown, your interest rate is reduced by 1% for the first year. With a 2/1 buydown, your rate is reduced by 2% in the first year and 1% in the second year, before returning to the standard rate.
Financial Benefits Q: How does a buydown save me money? A: The buydown program provides significant savings during the initial years of your mortgage. For example, on a $300,000 loan with a 7% interest rate, a 2/1 buydown could save you approximately $400-500 per month in the first year.
Q: Who pays for the buydown? A: The buydown can be paid for by the seller, builder, or us as the lender. Our team at The Mortgage Planner can help negotiate the best arrangement for your situation.
Qualification and Process Q: How do I know if I qualify for a buydown? A: Qualification depends on various factors including your credit score, income, and the type of property you're purchasing. Our experienced team, with over 10 years in the industry, can quickly assess your eligibility.
For more infomation call 704-728-0191 or visit www.TheMortgagePlanner.com to apply.