How To Buy Down: A Mortgage Rate

: Typically, one "point" costs 1% of the total loan amount .

: You plan to stay in the home for a long time (typically 5+ years) and don't intend to refinance soon. how to buy down a mortgage rate

: Your rate is 3% lower in the first year, 2% lower in the second, and 1% lower in the third. : Typically, one "point" costs 1% of the total loan amount

: You pay for a lower rate that lasts for the entire life of the loan. 2% lower in the second

: One point generally lowers your interest rate by 0.25% .

: You might move or refinance before the break-even point, as you will lose the upfront money spent on points.