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FHA 2/1 Buy Down Option

The FHA 2/1 buy down option was developed by the Federal Housing Authority (FHA) as a tool to facilitate more home buyers qualifying for the FHA Loan, and actually qualifying to buy a home.  This FHA loan program option is nothing more than a 30 year or 15 year Fixed Rate mortgage loan in which you, or the seller of a property, has agreed to a temporary buy down of your starting interest rate. 

This program option is ideal for qualified home buyers in any of the states we lend in from Alabama to beautiful Tennessee! Why not inquire today about the FHA 2-1 buy down option? Give us a call or just use our Quick Mortgage Application to find out more. At, we're all about understanding our programs and creating financing solutions tailored around you!

Advantages of Using Interest Rate Buy Downs

One of the largest advantages of the FHA two-one buy down loan program is by lowering the initial interest rate, a Home Buyer can start with a lower mortgage payment, allowing more FHA Home Buyers from North Carolina to Missouri to qualify and actually close on a home loan

There really is a great deal of misunderstanding as to what the FHA interest rate buy down option represents. This is not a permanent rate adjustment for your FHA Loan. After the first one or two years, depending upon the option you select, your interest rate will adjust to its final fixed rate. 

Based upon whether you opted for a 1/1 or a 2/1 buy down of your interest rate, your loan will adjust 1% each year until you reach your final interest rate.  This is a fixed rate FHA loan that allows you to temporarily buy down your interest rate for qualifying purposes.

Principles Behind The FHA 2/1 Buy Down Program 

The principle behind the 2/1 buy down loan using the standard 15 and 30 year terms, is to decrease your mortgage payment ratio, and overall debt ratio. This can allow qualified applicants to actually qualify for financing a home. Whether you live in Florida or reside in Mississippi, this is extraordinarily important for those who might not otherwise have the necessary ratios for qualifying.  Please bare in mind, the actual buy down fee will vary based upon the loan amount and the present interest rate available at the time of your rate lock. 

To learn more about the 2/1 FHA buy down loan program just give us a call today, or complete our short fast and easy Quick Mortgage Application

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