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Better Rate MortgageTemporary buydown calculator
Seller-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 6.875% on a $0 loan
$

Pre-filled with today’s posted 30-Year Fixed: 6.875% rate / 7.014% APR as of Nov 11, 8:57 AM. See today’s rates. Change it to match your quote.

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.

Get Started Today

Whether you’re purchasing your first home or taking cash out to make your dream home even dreamier, the door is open. Welcome to Better Rate Mortgage.

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