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Should you take a temporary 2-1 buydown from the seller, or use that money to permanently lower your rate? Run both side-by-side.
Your inputs
Year-1 payment
$1,461
vs. base $1,816
Year-1 savings
$4,266
What lands in your pocket
Total cost to fund
$6,450
Usually paid by seller/builder
Buydown length
2 yr
Then payment snaps to base
Year-by-year payment
Year
Rate
Monthly P&I
Vs. base
1
4.750%
$1,461
−$355
2
5.750%
$1,634
−$182
3
6.750%
$1,816
-
4
6.750%
$1,816
-
5
6.750%
$1,816
-
Tactical tip: a 2-1 buydown is almost always better as a seller concession than a price reduction of the same dollar amount - you keep the lower payment AND the higher appraisal/equity basis.
