Mortgage rates are nearly double from a year ago, they have cut into affordability and increased the monthly payments for buyers. By lowering the interest rate for the buyer, it can make the payment more feasible and possibly help get the property sold for the seller.
What is a mortgage rate buy-down? It is where the lender receives funds at closing to lower the buyers interest rate. Typically, it is 1 point which equals 1% of the loan amount.
If the seller is willing to offer a 1% of the loan amount closing cost credit to the buyer, the lender can lock in and offer the lower rate to the buyer. This can be very attractive to the buyer, make the seller’s property stand out against the competition.
In today’s market to attract buyers and close more deals sellers need to be creative, innovative, quick-witted, and knowledgeable on what is happening in the market.