Loan program
Seller-Paid Buydown
Lower your rate for the first 1, 2, or 3 years with seller-funded buydown credits.
A seller-paid buydown reduces your effective interest rate during the first 1–3 years of the loan — easing into homeownership during the most cash-strapped years.
In a high-rate environment, a temporary buydown is often the most overlooked path to monthly affordability. Sellers and builders use buydowns as a creative concession that benefits the buyer without dropping the sale price.
The most common structure is 3-2-1: your effective rate is 3 percentage points lower in year one, 2 lower in year two, 1 lower in year three, then settles at the permanent rate from year four on.
Buydown funds are held in escrow and effectively prepay part of your interest. If rates drop and you refi out, unused buydown funds return to the seller — but you keep the lower payments you already received.
What it gives you
Lower Year-One Payments
3-2-1 buydown drops rate by 3%, 2%, 1% in years 1, 2, 3.
Seller-Funded
Cost is paid by the seller as a concession — common in slower markets.
Permanent Rate Stays Available
After buydown period, rate returns to permanent locked rate.
Refinance Optionality
If rates drop, you can refi out during the buydown period.
How it runs, start to finish
- 1
Negotiate Concession
Your agent negotiates the buydown as part of the offer.
- 2
Lock Permanent Rate
Lock the underlying 30-year rate.
- 3
Seller Funds Escrow
Buydown funds escrowed at closing.
- 4
Reduced Payments
Enjoy 1–3 years of reduced payments before rate steps to permanent.
Questions people ask about this one
What does 3-2-1 mean?
Year 1 rate is 3% lower than permanent, year 2 is 2% lower, year 3 is 1% lower, year 4+ is permanent rate.
Who pays for the buydown?
Typically the seller as a concession. Sometimes builders cover it on new construction.
Is this the same as paying points?
No — points permanently buy down the rate. Buydowns are temporary, refundable if you refi out.
Are there other buydown structures?
Yes — 2-1, 1-0, and fixed-rate buydowns. We'll match the structure to your goals.
Programs people look at next
The first step is a conversation, and it costs nothing.
No documents, no credit pull, no obligation afterwards. Just somebody explaining the part you are stuck on.
Or call(503) 555-0175and ask for whoever is free.
