2-1 Buydown
2-Year Rate ReductionYear 1 Payment (4.00% Effective Rate)
$6,683.81 /mo
Monthly subsidy: $1,709.89/mo ($20,518.72 in Year 1)
Year 1 4.00%
$6,683.81/mo
(-$1,709.89)
Year 2 5.00%
$7,515.50/mo
(-$878.20)
Years 3–30 6.00%
$8,393.71/mo
3-2-1 Buydown
3-Year Rate ReductionYear 1 Payment (3.00% Effective Rate)
$5,902.46 /mo
Monthly subsidy: $2,491.25/mo ($29,895.01 in Year 1)
Year 1 3.00%
$5,902.46/mo
(-$2,491.25)
Year 2 4.00%
$6,683.81/mo
(-$1,709.89)
Year 3 5.00%
$7,515.50/mo
(-$878.20)
Years 4–30 6.00%
$8,393.71/mo
Program Comparison Summary
Monthly Principal & Interest payment progression and total seller funding requirement
| Program | Year 1 P&I ($/mo) | Year 2 P&I ($/mo) | Year 3 P&I ($/mo) | Full P&I ($/mo) | Seller Cost ($) |
|---|---|---|---|---|---|
| 2-1 Buydown | $6,683.81 | $7,515.50 | $8,393.71 | $8,393.71 | $31,057.17 |
| 3-2-1 Buydown | $5,902.46 | $6,683.81 | $7,515.50 | $8,393.71 | $60,952.18 |
Annual Payment Structure & Seller Funding
Year-by-year effective interest rates, monthly P&I, and monthly/annual subsidy schedule
| Program | Year | Effective Rate (%) | Full Note P&I ($/mo) | Buydown P&I ($/mo) | Monthly Subsidy ($) | Annual Subsidy ($) |
|---|
Notes & Assumptions
- Buydown subsidy = (contractual monthly P&I − reduced monthly P&I) × 12 per subsidized year.
- Illustrative fixed-rate fully amortizing loan; temporary buydown changes borrower payment, not note rate.
- Taxes, insurance, HOA, closing costs and any administrative buydown fees are excluded.
- Jumbo lender/investor approval, seller concession limits, underwriting and program eligibility must be verified.