Rate | Buy Down

: Funds are held in an escrow account and used to subsidize monthly payments. These are almost always paid for by the seller or builder as an incentive. Common Structures :

: The borrower (or sometimes the seller) pays "points" to the lender at closing. rate buy down

: Buyers planning to keep their home and mortgage for a long period (usually 5–7+ years) to reach the "break-even point" where monthly savings exceed the upfront cost. 2. Temporary Buydowns : Funds are held in an escrow account

: Rate is 2% lower in Year 1 and 1% lower in Year 2. 1-0 Buydown : Rate is 1% lower for the first year only. rate buy down

: Generally, one point reduces the interest rate by approximately 0.25% to 0.5% .