What Is a 2/1 Buydown and How Does It Work? - Total Mortgage

Abstract

A 2/1 buydown allows borrowers to pay more upfront while enjoying reduced interest rates for the first two years of their mortgage. Buydowns are arrangements that allow borrowers to more easily qualify for mortgages with a lower interest rate. Lenders often require either the seller or buyer to pay an extra fee for this financing agreement. If you don’t account for the lender’s fee, this could save the borrower $4,198. If the escrow agent doesn't send the payment. For more information, to the seller and the seller. or the agent doesn”t send the Payment may be on the hook for the payment may be in an escrow account.