---
title: Temporary Buydown
description: A Home Equity Line of Credit (HELOC) is a popular way to turn home ownership into cash when you need it.
---

[First Federal Bank Blog ](https://blog.ffbf.com)

# [Temporary Buydown](https://blog.ffbf.com/temporary-buydown)

 Written by [First Federal Bank](https://blog.ffbf.com/author/first-federal-bank) | August 8, 2024 9:01:26 PM Z

### **Buydowns: A Strategy for Lowering Interest Rates**

1. **Upfront Payment:** Another party pays an upfront payment at closing.

2. **Interest Rate Reduction: **In exchange for the upfront payment, First Federal Bank will lower the interest rate on the mortgage for a specified period. We do 3-2-1 buydowns, 2-1 buydowns, and 1-0 buydowns.

A common buydown might be a 2-1 buydown, where the interest rate is reduced by 2% in the first year and by 1% in the second year before reverting to the original rate from the third year onward. The lowering of the rate is temporary.

3. **Temporary Benefit:** The reduced interest rate provides you with lower monthly mortgage payments during the initial years of the loan. This can make homeownership more affordable in the short term.

[View full post](https://blog.ffbf.com/temporary-buydown)

```json
{
  "@context" : "http://schema.org",
  "@type" : "BlogPosting",
  "author" : {
    "@type" : "Person",
    "name" : "First Federal Bank"
  },
  "dateModified" : "2024-08-08T21:01:45.236Z",
  "datePublished" : "2024-08-08T21:01:26Z",
  "headline" : "Temporary Buydown",
  "image" : {
    "@type" : "ImageObject",
    "height" : 410,
    "url" : "https://1649488.fs1.hubspotusercontent-na1.net/hubfs/1649488/social-suggested-images/files.keepingcurrentmatters.comKeepingCurrentMatterscontentimages2024032120240325-What-Every-Homebuyer-Should-Know-About-Closing-Costs-1.png",
    "width" : 750
  },
  "mainEntityOfPage" : "https://blog.ffbf.com/temporary-buydown",
  "publisher" : {
    "@type" : "Organization",
    "logo" : {
      "@type" : "ImageObject",
      "height" : 60,
      "url" : "/hs/hsstatic/content_shared_assets/static-1.4092/img/default-amp-logo.png",
      "width" : 60
    },
    "name" : "First Federal Bank Blog"
  }
}
```