![]() “As long as the seller nets what they want on the house, they can build it into the price. “It’s a credit the seller offers that pays the difference of that lower rate in the first couple of years,” said Moony, noting developers used it 20-plus years ago to entice buyers to purchase the few remaining homes in a development. For example, if today’s rate is 6.5%, using a 2-1 buydown, you start year one at 4.5%, year two at 5.5% and year three and beyond at 6.5%. A seller-paid credit to incentivize buyers to purchase a home, a rate buydown allows for a lower rate the first couple of years without an adjustable rate, explained John Moony, senior vice president, mortgage lending, at Guaranteed Rate Affinity. That sweet spot can be found using different product offerings. “It’s important to work closely together to help determine the right sweet spot for buyers.” “We have a partnership in terms of helping the buyer figure out what their budget is and what options they have from a price standpoint,” Tisler said. He also co-hosts regular homebuyer seminars with agents. Lenders and agents work in tandemĮvery week, Andrew Tisler, a senior home lending advisor with Chase Bank, sends his agent partners a newsletter containing current rates so they are fully educated and up to speed for clients. So, as the market recalibrates, lenders are sharing the most effective ways to bring buyers back to the transaction table and prepare them to sign on the dotted line. The option to refinance later has kept buyers in the market, and those buyers can now focus on choosing homes that speak to their hopes and dreams. Rate buydown products and ARMs, which may not have come up much the past few years, are once again part of the mortgage conversation. Long-term mortgage loans hover in the 6% range, signaling a return to more ordinary times for lenders, agents and buyers. ![]() The frenzied rush to market from historically low interest rates is over. ![]()
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