1% Buydown Loans

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      The 1% buydown loan is a mortgage option where the borrower pays an upfront fee to reduce the interest rate on the loan for a specific period. It is a way to lower the initial monthly payments of the mortgage.

In a 1% buydown loan, the borrower pays a one-time fee to the lender. This fee is used to temporarily reduce the interest rate on the loan, which is typically 1% lower than the note rate. After the initial year, the interest rate gradually increases until it reaches the note rate, after which it remains fixed for the remainder of the loan term.

      When considering a 1% buydown loan, it’s advisable to carefully review the terms and costs associated with the program. It’s important to understand the potential long-term costs, such as the impact on total interest paid over the life of the loan and compare it with other mortgage options.

It’s important to note that some specifics of this loan can vary depending on the lender and loan terms. Sterling Financial Services can help you determine if this loan is the right fit for you and your homeownership needs.