Definition of 3-2-1 Buydown
3-2-1 Buydown is a type of mortgage with a series of three initial temporary-start prices of attention that surge in a stair-step fashion until a permanent attention prices are reached.
Brief Explanation of 3-2-1 Buydown
Lenders will charge for the short-term attention amount discount prices. A 3-2-1 buydown is sometimes used as a method to help a borrower with excess cash (but a relatively low income) to qualify for house financing. Or, it mortgage might be offered by a builder as incentive to purchase a house. It is similar to paying points on house financing in order to lower attention amount. However, remember, attention amount discount prices on it are short-term. A thorough analysis should be conducted to ensure that the buydown is the best economical choice for your current and future situation. It mortgage buydown allows real estate customer to reduce costs for the first three years. The payment structure allows customer to set some cash aside and use it towards making per month installments as they improve.