Buy Down Programs

Strictly speaking, there are two types of buy-down programs:

  • a href="http://www.atlastitle.net/literature/Buy-Down%20Programs.htm%23Permanent"> Permanent
  • a href="http://www.atlastitle.net/literature/Buy-Down%20Programs.htm%23Temporary"> Temporary

Both options entail a reduction of the interest rate through prepayment of the loan's interest. At the closing, the buyer, lender, seller or other related parties pay points in order to provide the borrower with a lower interest rate.

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