Definitions for "Interest Rate Buydown Plan"
An arrangement that allows the property seller to deposit money to an account. That money is then released each month to reduce the mortgagor's monthly payments during the early years of a mortgage.
A temporary buydown gives a borrower a reduced monthly payment during the first few years of a home loan and is typically paid for in an initial lump sum made by the seller, lender, or borrower. A permanent buydown is paid the same way but reduces the interest rate over the entire life of a home loan.
A plan in which the seller deposits monies into an account, to be used each month to lower the mortgagor's monthly payment during the initial loan term.