What does Interest Rate Buy-Down Plans mean?

A financial strategy used by some buyers and homeowners to reduce their monthly mortgage payments by paying a lump sum at closing, in exchange for a lower interest rate for the life of the loan. Buy-down plans can be used to make a home more affordable for a buyer who might not qualify for a conventional loan, or to help a homeowner refinance an existing loan to a lower rate.

Related Terms

Correct Zoning (In a Lease) Tenancy By The Entirety Damage & Destruction (In a Lease) Subdivision Commission agreement Buyer Broker Proceeds of Condemnation Planned Communities Online Real Estate Listings Knob-And-Tube Wiring Trade Equity Secured Loan Principle of Regression Add-On Interest Assessment Rolls Late Payment Custom Home Interest Rate