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A buydown is a way to lower your initial interest rate on your mortgage.
You accomplish this by paying additional points on your mortgage. A
point is simply one percent of your loan total. The buyer usually has
the option to pay as many points as they would like. Each increasing
point will lower your mortgage rate a certain level.
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Buy-Downs |
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The payment of additional points in return for a lower mortgage
rate |
| Discount Points |
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Each discount point equals one percent of your loan amount |
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