What’s the 2-1 Mortgage Buy Down Option, and how will it help you reduce your interest rate? When interest rates increase, some buyers can’t afford to purchase. This is bad news for the real estate market across the board. When buyers can’t afford homes, then sellers loose equity and neither party wins.
Real estate, like any market, is cyclical and we are currently in the stable index of the market. Meaning, the frenzy is over but has the market crashed? I wouldn’t say it’s crashed but I do not anticipate overpaying and low rates to return. As a matter of fact, the Fed’s have already increased over 100% in the last few months.
Fight High Interest Rates
To combat high interest rates we are seeing an increase of buyers using the 2-1 Mortgage Buy Down Option. This program has been around for several years, but due to low interest rates it simply hasn’t been used. The 2-1 buy down option is unique because it’s a fixed rate mortgage, unlike the Adjustable Rate Mortgages (ARM’s) we experienced in the past.
If you’re thinking about buying a home now is the time before interest rates increase. That’s right, we are expecting to see mortgage rates increase throughout this year.
The Fixed Rate Option
With a 2-1 buy down you will have a fixed rate locked in for the life of the loan. You won’t have to worry about increasing rates, and if rates drop then you have the ability to refinance. Most banks will refinance without heavy costs if the rates drop.
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Don’t let rates scare you. Housing is a necessity and paying rent yields you zero return. Creating a solid game plan to homeownership is vital. If you’re a first time homebuyer here are some steps you can take to ensure a stress free and successful purchase.
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If you’re looking to purchase a home in the Dallas, Plano, Frisco Texas area, try our up to the minute search. Click Here to customize your own home search.
Want to speak with me about your real estate needs? Reach out via phone 469-829-7713, email Troy@TroySage.com, or ➡️ Book a Call or ZOOM with Troy