Mortgage Buydown Calculator

See Year 1 payment relief, the full step-up schedule and total subsidy for common temporary mortgage buydowns, with permanent-points comparison available when you need it.

2-1 · 3-2-1 temporary planspayment ladder and subsidy funding

Permanent discount pointsupfront cost and lender-quoted rate cut

Simple break-evenpoints cost ÷ monthly P&I savings

Hold-period comparisonbaseline vs temporary vs permanent cash flow

Loan amount

Note rate (%)

Term years

Temporary buydown

—Full note-rate monthly P&I

Year	Temporary rate	Borrower payment	Monthly subsidy	Annual subsidy

—Estimated total temporary-payment subsidy

This models a temporary payment subsidy from rate-equivalent payment differences. The mortgage note rate and contractual full payment remain separate concepts; actual program terms and funding rules are lender-specific.

Mortgage buydown comparison workbench

Compare a temporary subsidy with permanent discount points

Keep the note-rate mortgage separate from the early-payment subsidy, then compare that cash-flow ladder with a permanent rate reduction priced in points.

P&I math · no rate quote

Loan amountNote rate (%)Term yearsPlanned hold years

Temporary planTemporary subsidy fundingPermanent pointsRate cut per point (pp)

—full note-rate monthly P&I

—full temporary subsidy required

—permanent points upfront cost

—simple permanent-points break-even

—modeled permanent rate

—modeled permanent monthly P&I

—largest temporary payment step-up

—baseline P&I over hold

Year	Rate reduction	Borrower rate	Borrower P&I / mo	Monthly subsidy	Annual subsidy

Temporary plan · borrower cash outlay

——over the selected hold period; external credits are not counted as borrower cash.

Permanent points + P&I

——includes modeled upfront point cost and permanent reduced-rate P&I.

Baseline note-rate P&I

Use metric abovecomparison baseline; taxes, insurance, HOA and other costs are excluded.

Ready.

Copyable buydown audit

Interpretation boundary. This is principal-and-interest modeling, not a lender quote or underwriting decision. A temporary buydown does not change the mortgage note rate; program funding, seller/lender credits, qualifying rules and unused-fund treatment depend on the actual loan and agreement. Fannie Mae guidance states that eligible temporary plans do not change the note terms and borrowers are qualified using the note rate rather than the bought-down rate. Permanent point pricing also varies by lender and market, so the “rate cut per point” field is deliberately editable. Fannie Mae temporary buydown guide.

Core borrowing, saving & investing workflows

Start with the broad calculator that matches the decision, then move to a specialist only when the loan structure, cash flow, tax treatment, debt strategy or savings goal genuinely changes.

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Model a temporary buydown

Choose a 3-2-1, 2-1, 1-1, or 1-0 schedule. The tool compares payments calculated at the temporary effective rates with the full note-rate payment and totals the modeled subsidy across the temporary years.

Program terms vary

Actual temporary buydowns are lender/program specific. This calculator models payment differences and does not determine eligibility, who may fund the subsidy, escrow handling, qualification rules, or contractual disclosures.