What today’s buyers need to know about interest rate buydowns.
Are you concerned about higher interest rates? The more rates increase, the more difficult it becomes to purchase a home. Fortunately, Scott Moses is here with me to discuss a few ways you can deal with higher interest rates and buy the home of your dreams.
Besides higher interest rates, our current market is great for buyers. Inventory is up, and there is less competition than when the market was hot. That means you can negotiate a fantastic deal with your seller.
One of the best things you can negotiate with your seller is an interest rate buydown. If you aren’t familiar with this, there are two main types: permanent and 2-1 buydowns. Permanent buydowns work just the way you think they would. You pay an upfront fee, and your interest rate permanently goes down. With a 2-1 buydown, your interest rate is 2% lower the first year of your loan and 1% lower the second year of your loan. After that, your rate returns to what it was before the buydown.
“Our current market has great opportunities for buyers.”
There are some major benefits to temporary buydowns. They are less expensive up front, so your seller may be more willing to pay yours for you in full. Plus, rates are expected to fall within the next two years. When that happens, you can just refinance down to a new, lower rate.
If you are interested in either of these options, reach out to Scott at (702) 400-4626 or scott.moses@homebridge.com. As always, don’t hesitate to call or email with any real estate questions. I look forward to hearing from you.
