Temporary buydown calculatorSeller-paid rate relief
How much does a 2-1 buydown save you?
A temporary buydown lowers your interest rate for the first year or two — usually paid for with a seller concession. See the lower payments, the total cost, and exactly what to ask the seller for.
Your note-rate payment
$0
P&I at 6.5% on a $0 loan
$
2-1 Buydown
Rate drops 2% in year one, 1% in year two, then your note rate.
Year 1 4.5%$0$0/mo
Year 2 5.5%$0$0/mo
Buydown cost$0
Ask the seller for a concession of about — of the purchase price.
1-0 Buydown
Rate drops 1% in year one, then your note rate.
Year 1 5.5%$0$0/mo
Buydown cost$0
Ask the seller for a concession of about — of the purchase price.
Why buyers like it: with either option your payment starts lower while your income grows or rates drop — and if rates fall, you can look at refinancing while the escrowed buydown funds cover part of the gap. Ask us which option fits your offer →
Estimate for education only — principal & interest at illustrative rates; excludes taxes, insurance, and mortgage insurance. Buydown availability, structure, and funding depend on the loan program, the seller, and underwriting approval; not a commitment to lend or a rate quote. Better Rate Mortgage · NMLS #2401335 · Equal Housing Lender.
Temporary buydown questions, answered
What is a 2-1 temporary buydown?
A 2-1 buydown lowers your interest rate by 2% in the first year and 1% in the second year; from year three on you pay the full note rate. The difference is prepaid into an escrow account at closing, usually funded by a seller concession.
Who pays for a temporary buydown?
Most often the seller (or builder) funds the buydown as a concession negotiated in your offer. This calculator shows the concession as a percentage of the purchase price so your agent knows exactly what to ask for.
Is a temporary buydown better than a permanent one?
They solve different problems. A permanent buydown (paying points) lowers the rate for the whole loan; a temporary buydown gives bigger relief in the early years for less money. If rates fall, temporary-buydown borrowers can explore refinancing; unused escrowed funds typically credit toward the loan balance.
Do I qualify at the lower rate or the note rate?
You qualify at the note rate, not the temporary first-year rate. The buydown lowers what you pay early on, not the underwriting standard.
