With mortgage rates continuing to climb and additional rate hikes by the Federal Reserve Open Market Committee on the horizon, affordability concerns continue to impact prospective homebuyers across the nation. Peter Idziak has identified a lesser-known possible solution gaining popularity with buyers and sellers: temporary mortgage rate buydowns.
Peter recently spoke with The Washington Post for a Q&A on how buydowns work and their benefits.
“A temporary buy-down is a cash payment that effectively lowers the borrower’s interest rate for a limited period, allowing borrowers to reduce their monthly payments during the early years of the mortgage…,” Idziak explained. “The first few years of homeownership are often the most expensive, especially for first-time buyers. Furnishing a home and completing renovations or upgrades are often major expenses for buyers. A temporary buydown provided by the seller allows the borrower to have more money available during these years to handle such costs.”
Peter’s interview with The Post is available here.