| Interest Rate Buydowns
If you opt for a Florida interest rate buydown mortgage, the seller will pay an amount to the Florida mortgage lender, which allows the lender can give you a lower rate and lower mortgage payments. Buydowns can occur in all types of Florida mortgages. In a buydown mortgage the interest rate is reduced for the first 2 years of the mortgage then slowly grows to the final interest rate. The reduction that takes place in a 2-1 buy down is 2% less than the final mortgage rate for the first year and a reduction of 1% for the second year. By the third year the interest rate on the Florida mortgage returns to the final rate for the remaining years.
The 3-2-1 buydown is another variation on the Florida 2-1 buydown mortgage and works in the same way but the reduction lasts for a longer period of time. Florida buydown mortgages can reduce the borrower’s monthly payments but the payments will increase when the period of reduction ends. Contact your URL home loan advisor to discuss your Florida buydown options further.
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