The #1 Mortgage Strategy & Solution in a High Rate Environment

Mortgage and Lending with Kamaaina Mortgage Group Inc.| Equal Housing Lender, NMLS 1276471 - NMLS 312260 NMLS# 312260 / 1276471


In a real estate transaction, a temporary buydown can be paid by either the seller or the borrower.

If the seller pays for the temporary buydown, it is typically done as a negotiating tactic to make the property more attractive to potential buyers. The seller may offer to pay a fee upfront to lower the borrower's interest rate for a certain period of time, which can result in lower monthly mortgage payments for the borrower. This can be especially appealing to buyers who may not qualify for a traditional mortgage due to their income or credit score.

On the other hand, if the borrower pays for the temporary buydown, they are essentially paying an upfront fee in exchange for a lower interest rate for a certain period of time. This can be an attractive option for borrowers who want to lower their monthly mortgage payments initially, especially if they expect their income to increase in the future.

It's important to note that temporary buydowns may not be available in all areas and may not be suitable for all borrowers. It's a good idea to speak with a financial advisor or mortgage professional to determine if a temporary buydown is a good option for your specific situation.

In this higher Rate environment, an Interest Rate Buydown can be a great option, that can lead to a Win-Win Situation for the buyer.

3-2-1 Buydown 

2-1    Buydown 

1-1    Buydown 

1-0   Buydown 

These are the Options for the Seller to help a buyer to buy down the temporary interest Rate.


Comments (1)

Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning George. I thought the days of creativity as a necessity were behind us. That said, I was wrong. If we doin't make changes quick creativity will become the new normal. Enjoy your day.

Oct 20, 2022 03:08 AM
George Thoma

Thanks on this comment , 

Yes we have to work creative and thanks to some lenders offering this option to help buyers and sellers.

Dec 06, 2022 07:53 PM