Overview
A temporary buydown is an option that creates a funded buydown account that is used to temporarily reduce the borrower’s monthly payment during the initial year(s) of the loan. The Note Rate remains constant; only the borrower’s payment is reduced.
* For Conforming & High Balance Loan
Loan Scenario
The First Year Rate is 4.375%
· 2-1 Buydown
· 30 Years Fixed
· Note Rate 6.375% (Note rate quotes as of 11/21/2022, subject to market change)
· Loan Amount $500,000 * Max. seller credit 2.5% to cover the cost (including buydown rate)
| Year 1 | Year 2 | Year 3, 4, 5, … | |
| Interest Rate | 4.375% | 5.375% | 6.375% |
| Mthly PMT | $2,496.43 | $2,799.86 | $3,119.35 |
| Mthly PMT Saving | $622.92 | $319.49 | / |
· Loan amount < $150,000 (-0.500)
· Att-Condo w/term >15 Yr & LTV >75% - 80% (-0.750)
· 2-4 Units w/all terms & LTV≤80% (-1.000)
· Subordination CLTV<80% (-0.375) , CLTV≥80% (-1.250)
· High Balance LTV >60% - 75% (-0.750), >75% - 90% (-1.000)
· 45 day (-0.149), 60 day (-0.250)
★Eligible Account Source -Contributor is from only Seller/Builder. Other interest parties contributions depends on lender approval.
★Temporary Buydown cost depends on the total annual mortgage payment difference between the buy-down rate and note rate.
★Lender Fee same as the Agency Program.
