Fresh Home Loan Inc. President, Garrick Werdmuller Explains What A Seller-Paid Rate Buydown Is?

With mortgage interest rates spiking as fast as they did earlier this year, there has been a dramatic shift in the housing market and a lot of sellers are facing price reductions.

A great strategy to avoid a price reduction is the seller buydown.

How this works is lenders allow the seller of a home to “credit” a portion of their proceeds to the home buyer. Typically, we call it a credit towards non-recurring closing costs, and the credit is applied to the lump sum of closing costs at the closing table. This is often referred to as a seller concession. These funds can only assist with the closing costs and not the down payment.

In markets with sudden rate shifts like we are seeing today, you can also use these credits to buy down the interest rate. This helps the buyer get a lower interest rate and payment and can avoid price reductions.

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Garrick Werdmuller is President and CEO of Fresh Home Loan

Garrick Werdmuller President


Fresh Home Loan Inc

510.282.5456 call/text 

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Garrick Werdmuller
(510) 282-5456