What is a 2 – 1 Mortgage Interest Rate Buydown | Pros & Cons

When interest rates are sky high you will hear a lot of Realtors & Lenders talking about the 2 – 1 Interest Rate Buy Down that allows home buyers to pay a lower monthly mortgage payment for the first 2 years of their home loan.

This video will cover how the 2-1 buydown works as well as some of the pros and cons of the buydown, and the variables to consider when deciding if it’s something you would like to try for with your home purchase.

Here is a link to the free 2 -1 Buydown Calculator that you can download with no personal information:

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Scott Hodge Broker | Owner | Veteran US Navy
Homeport Residential
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[paoworthington]

Excellent informaiton and thank you so much for the document!

[dheeru]

Is it worth choosing a 2-1 buydown for 5-6-7 interest rates, considering the current market conditions and the expectation that interest rates will decrease within a year and refi ?

[godsangel]

Hello. So if the interest rate gets lower at any time during the first or second year we (buyers) can refinance to get the lower interest rate?

[XenomorphLV]

Is this something you ask your loan officer or your agent first?

[dr.satyapatel]

How much does it cost for 2/1 buy down?

[sounddesigner]

What would you suggest in this situation? I own a million dollar home that is fully paid for. I want to buy another million dollar home next week but that doesn't give me enough time to sell my existing one. So, I have to get a mortgage on the new home to buy before it is sold to another buyer. It's not a problem, I can afford the down and will qualify for the new mortgage. I then sell my fully owned million dollar home in a month. I want to take that million dollars and pay off the mortgage I have open on the new million dollar house and be debt free again. Is it best to get a 30 year mortgage with no pre-payment penalty or is there any benefit to shop for other types of mortgage products out there?