(WB) Mortgage Buydown

  What It Is:
Temporary rate reduction—2% in Year 1, 1% in Year 2, then returns to full fixed rate.

  Purpose:
Boosts buyer affordability and makes listings more attractive.

  Buyer Benefits:
Lower early payments, easier budgeting, greater purchasing power.

  Seller/Realtor Benefits:
Faster sales, increased interest, stronger marketing tool.

  Compliance:
Must follow TILA; full disclosure in loan and closing documents.

  Example:
$450K home—seller funds 2-1 buydown; quicker sale due to affordable initial payments.

  Funding:
Seller, builder, or lender credits (where allowed); document all contributions.

  Considerations:
Prepare buyers for higher future payments; discuss refinancing options.

  If Refinance Occurs:
Unused buydown funds reduce principal balance.