Purchase · 5 min read
Can the seller pay for a temporary rate buydown so my payment starts lower?
October 7, 2026 · Written by Bill Egan, NMLS 7342
Short answer
Yes. On many purchase loans a seller can pay for a temporary rate buydown. A 2-1 buydown lowers the rate used for your payment by 2 percentage points in year one and 1 point in year two, then the payment goes to the note rate. The seller puts that subsidy in an account at closing. It does not change the rate on your note. You still have to qualify on the full payment after the buydown ends.
01
Why this comes up
The payment at today’s rate is higher than you hoped, and the listing agent says the seller will pay for a buydown so the first years feel cheaper.
02
Where this goes wrong
The offer treats the buydown like a lower loan rate. On the file, the note rate is what you qualify on. If you only budgeted the year-one payment, year three can be a shock, and the seller credit may already be used up by other closing costs.
03
What we do about it
We put the note-rate payment and the buydown payment side by side, check that the seller credit fits the program limit, and show you the year-three payment before you write the offer.
04
How to get ready
Ask whether the seller will pay closing costs. Bring the monthly payment you can live with, not just the house price. Have recent bank statements ready so we can see cash to close with and without that credit.