2/1 buydown to lower your rate and mortgage payment
If you want to buy a house, but are worried about today's interest rates, you might want to consider getting a mortgage with a 2/1 buydown.
Mortgage 2/1 Buydown, How It Works
A buydown is a feature on some mortgages that reduces your interest rate for a certain period of time. Specifically, the 2/1 buydown allows you to lower your interest rate in year 1 by 2% and 1% in year two.
A lower interest rate on your loan lowers your monthly payment and makes it easier for you to afford a home. This helps homeowners reinvest in years one and two. You can use that extra money to remodel, buy furniture, swap out old appliances, and take care of other extra expenses.
The best part is, that you can always refinance. If rates drop during the two-year period, you can use the remainder of your buy-down, so there is no risk to you.
The Flexibility And Certainty Of A 2/1 Mortgage Buydown
With a 2/1 buydown, you get a mortgage with an initial interest rate that's lower than what current rates would be for similar loans. You pay a little more in closing costs, but this is spread across the life of the loan. For Example, when you save 2% on a $400,000 loan, you could save $500 per month in year one.
A buydown allows you to lock in at today's low rates while still having some flexibility if and when rates fall further down the road. You can refinance if and when mortgage rates drop -- or just keep paying as you go along if they don't go down by much or at all.

Next Steps
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