What is a Mortgage Interest Rate Buy Down?
Posted by Andy Mandel on
Navigating Home Financing with Rate Buy Downs
In the ever-evolving landscape of South Florida real estate, understanding your financing options is crucial. A mortgage interest rate buy down, especially in a market with higher rates, can provide significant financial benefits.
How Does A Rate Buy Down Work?
This strategy involves temporarily reducing the mortgage interest rate, resulting in lower initial monthly payments. For a 3/2/1 buy down, the rate decreases by 3% in the first year, 2% in the second, and 1% in the third, before reverting to the standard rate.
Applying It to a $750,000 Home Purchase
With the current standard rate at roughly 6.9% as of early December 2023, let's see how this impacts a 30-year fixed mortgage:
- …
414 Views, 0 Comments