These provide a significant interest rate reduction during the initial years, after which the rate returns to the original "note rate".
: Funds are held in an escrow account and used to subsidize monthly payments. These are almost always paid for by the seller or builder as an incentive. Common Structures :
: Each point typically costs 1% of the total loan amount .
: Buyers planning to keep their home and mortgage for a long period (usually 5–7+ years) to reach the "break-even point" where monthly savings exceed the upfront cost. 2. Temporary Buydowns
