Financed Permanent Buydown Mortgages
Lower monthly payments and no additional cash at closing
Effective January 1, 2015, we will no longer purchase ARMs with lookback periods of less than 45 days. Review Single-Family Seller/Servicer Guide Bulletin 2014-12 for more information, including the October 20, 2014, cutoff date in the selling system.
Your financially savvy borrowers are always looking for more creative ways to finance their home purchases and increase their home purchasing power.
The Financed Permanent Buydown Mortgage lowers your borrowers' monthly payments without requiring additional cash at closing. With this offering, your borrowers can permanently reduce their interest rate by financing up to three discount points into the loan amount for fixed-rate mortgages and 5/6-month, 7/6-month, 10/6-month, 5/1, 7/1 and 10/1 ARMs. By financing the discount points up front, the interest rate can be up to 75 basis points lower than prevailing market rates.
By combining a Financed Permanent Buydown Mortgage with other flexible Freddie Mac mortgage products, you'll qualify more borrowers for larger mortgage amounts. For your refinance borrowers, a Financed Permanent Buydown Mortgage may be an exceptional option to refinance from high interest-rate loans to below-market interest rates.
|Eligible Mortgage Products||
|Maximum LTV Ratios (without secondary financing)||
|Special Delivery Requirements||
|Single-Family Seller/Servicer Guide||
Download a Financed Permanent Buydown Mortgages fact sheet for more details.
Use Financed Permanent Buydown Mortgages to:
- Offer better rates and lower payments to your borrowers.
- Retain more borrowers while providing an attractive refinance option for borrowers with ARMs that are adjusting to higher rates, to minimize payment shock.
Benefits for Your Borrowers
Financed Permanent Buydown Mortgages help your borrowers:
- Lower monthly payments with no additional cash at closing.
- Obtain a lower interest rate while increasing purchasing power.
Get More Information
- Call your Freddie Mac representative
- Print a Financed Permanent Buydown Mortgages fact sheet.
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The information in this document is not a replacement or substitute for information found in the Single-Family Seller/Servicer Guide and/or the terms of your Master Agreement and/or Master Commitment.