Should i buy down my interest rate?

With rates going higher you may want to consider an interest rate buy down.

How does this work?

lets take a couple of examples starting with a current rate(estimated) of 5%

2-1 and 3-2-1 buydowns

The 2-1 works like this.

Year 1 you get 2% off the rate so you pay 3% in year 1

Year 2 you get 1% off the original rate so you pay 4% in year 2

the 3-2-1 is similar

Year 1 you get 3% off so 2%

year 2 you get 2% off so 3%

year 3 you get 1% off so 4%

Who does this work for?

A. Someone who will make more money next year than this year

B. Someone who will collect more rent next year than this year.

Check with your agent and your MTG Broker to explore your options on this.