Lower Payments When It Matters Most
A temporary buydown lowers your monthly mortgage payment for the first one to three years of your loan. A seller, builder, or other eligible party contributes funds at closing to cover the difference, giving you more room in your budget while you settle into your home.
Things to Know
- Up to 3% lower rate
- 3-2-1 · 2-1 · 1-1 · 1-0
- Seller / builder
- Note rate
- Conv · FHA · VA
Ready to talk?
A loan officer who answers the phone, knows this program, and will tell you plainly whether it fits.
Disclaimer: Ark-La-TexFinancial Services, LLC d/b/a Benchmark Mortgage – NMLS ID #2143 (www.nmlsconsumeraccess.org) 5160 Tennyson Pkwy STE 1000, Plano, TX 75024. 972-398-7676. This advertisement is for general information purposes only, no guarantee is expressed or implied. Rates, terms, programs and underwriting policies subject to change without notice. This is not an offer to extend credit or a commitment to lend. All loans subject to underwriting approval. Not all applicants will qualify. Some products may not be available in all states and restrictions apply. (https://benchmark.us)
How a buydown actually works
A temporary mortgage buydown reduces your initial monthly payments without changing your note rate. Instead, a lump sum — often paid by the seller or builder as a concession — is placed in an escrow account at closing. Each month during the buydown period, that account covers the difference between your full payment and the reduced one. Once that period ends, you’re paying the full note-rate payment you qualified for from day one.
Temporary buydowns vs. discount points
A temporary buydown lowers your payments for a set period — usually one to three years — without changing your loan's interest rate. Discount points lower the actual interest rate, generally for the life of the loan. The better option depends on your upfront costs, monthly budget, and long-term plans.
Negotiating the concession
Buydowns are most common with builders and in markets where sellers are offering concessions, instead of lowering the purchase price. Your agent and loan officer can help you explore available contributions and determine what your loan program allows.
Program eligibility
Temporary buydowns work with conventional, FHA, and VA purchase loans. You must qualify at the full note rate. Program restrictions may apply.
If you refinance early
Any unused buydown funds are generally applied to your loan balance when the loan is paid off. You don’t lose them.
Estimate With Our Buydown Calculator
We built a buydown calculator so you can see the full payment schedule — every year, every dollar of the concession — before you negotiate. No guesswork at the table.
| Period | Rate | Payment | Monthly Savings | Annual Savings |
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The information provided by this calculator is for illustrative purposes only and accuracy is not guaranteed. The values and figures shown are hypothetical and may not be applicable to your individual situation. Be sure to consult a financial professional prior to relying on the results. This calculator does not have the ability to pre-qualify you for any mortgage or loan program. Qualification for mortgages or loans requires additional information such as credit scores and existing debts which is not gathered in this calculator. Information such as interest rates and pricing are subject to change at any time and without notice. All information such as interest rates, taxes, insurance, monthly mortgage payments, etc. are estimates and should be used for comparison only. Ark-La-Tex Financial Services, LLC – NMLS#2143 does not guarantee any of the information obtained by any calculator.
What makes it work for you?
- Year-one payment based on a rate 1–3% below your note rate
- 1-0, 1-1, 2-1 and 3-2-1 structures
- Funded at closing, typically by the seller or builder
- Works with conventional, FHA, and VA purchases
- Predictable payments throughout the buydown period
- See every year’s savings in the buydown calculator
A good fit if you…
- Are buying new construction with a builder incentive
- Negotiated a seller concession and want to put it toward payments
- Expect your income to grow or plan to refinance within a few years
- Want breathing room in the first years of ownership
Probably not the right fit if you...
- Have no seller or builder concession available (consider discount points)
- Plan to hold the loan long-term and would rather lower the rate permanently
- Are refinancing or buying an investment property
Additional options to think about
Compare with other programs
FAQ
Short, honest answers. Your loan officer can go deeper on any of these.
What is a 3-2-1 buydown?
A temporary buydown where your effective interest rate is reduced by 3% the first year, 2% the second, and 1% the third, before returning to your note rate. The payment difference is paid from an escrow account funded at closing — usually by the seller or builder.
Who pays for a buydown?
Typically the seller or builder as a negotiated concession. The cost equals the sum of all the payment reductions, which this calculator totals for you.
Do I qualify at the lower rate?
No — lenders qualify you at the full note rate. The buydown eases your early payments; it doesn’t change what you must qualify for.
Is a buydown better than paying points?
They solve different problems. A temporary buydown lowers payments for one to three years; discount points permanently lower your note rate. If you expect to refinance or sell within a few years, a buydown often delivers more value per dollar; if you’ll hold the loan long-term, points may win.
What happens to unused buydown funds if I refinance?
If you pay off the loan early, remaining escrowed buydown funds are generally applied to your loan balance. Your loan officer can confirm how your specific buydown agreement handles it.
Which loan programs allow a temporary buydown?
Temporary buydowns work with conventional, FHA, VA, and USDA purchase loans. They are generally not available on refinances or investment properties. [CONFIRM: Benchmark program availability]
HOW IT WORKS
Four steps from here to keys
Talk through the concession with your loan officer
A 15-minute conversation about where you are and where you want to go.
Get pre-approved
You provide supporting documents like income statements, W-2s, and bank statements. Most of it can be uploaded in minutes.
Shop with confidence
We handle the appraisal and the paperwork sellers worry about.
Sign & Close
Sign, fund, and get the keys. We stay on the file until the end.
Talk through the concession with your loan officer
A 15-minute conversation. No obligation. Real answers from a loan officer who answers the phone.