What is the 3,2,1 Buydown Program and is it right for you?

Benefit From the Buydown Program

The 3,2,1 Buydown Program is a type of financing program that allows borrowers to buy down and receive a  lower interest rate on their mortgage for the first THREE years. After the initial three-year period is up, the interest rate returns to the regular rate and remains permanent for the remainder of the loan.  

Who Pays For This?

It is very common for a buyer to request a closing cost credit from the seller in this market which can completely cover the cost of this program.  For example, the seller can pay for a buyer to have a mortgage rate of 2.5% in Year 1, 3.5% in Year 2 and 4.5% in Year 3.  This is a common program that is used when mortgage interest rates are high and the return to lower rates is highly likely in the coming 12 to 24 months.  Once mortgage rates drop a client can refinance this loan to a lower interest rate; resulting in the client NEVER having to pay interest on the current market rate at the time of purchase.

How Much Does This Cost?

This program varies in cost from about 2 points to 3 points, but as mentioned above most borrowers pay $0 as this is paid by the seller when the real estate agent requests the property closing cost credit at the time an offer is placed on the home.

What is the 3,2,1 Buydown Program and is it right for you?


When interest rates are higher, fixed-rate loans can be a little more expensive than adjustable-rate mortgages. However, adjustable-rate mortgages have variable interest rates. The 3,2,1 Buydown Program is a great alternative because borrowers can secure a fixed interest rate for the life of the loan and have the benefit of receiving a reduced rate and payment for the first few years.

How Do I Qualify?


Your Home Loan Could Be Fully
Funded 21 Days From Now

  • fixed rate

  • Adjustable Rates Mortgage

  • Conforming

  • jumbo and super
    jumbo loans

  • FHA, VA, &
    USDA Loans

  • Terms from
    5 to 30 Years

Reach Out About Our 3,2,1 Buydown Program Today!

Our 3,2,1 Buydown Program may offer the best terms for financing your home purchase. To find out what types of financing you would qualify for click the link below or call us at 844-4MODERN today!