How 2-1 Buydowns Make Homes More Affordable

By Jeff Ryder

Jeff Ryder moved to Colorado Springs in 1993 as a Flight Paramedic at Fort Carson, serving in the U.S. Army. After his military service, he transitioned into journalism as a news anchor for the local CBS affiliate, KKTV, where he spent three years delivering stories that mattered to the community. His passion for helping people led him into real estate, where he has since built a thriving career, assisting over 1,500 families in making their next move.

Buying a home feels tough right now. Rates are higher, prices haven’t dropped, and affordability is tighter than ever. If you’ve been wondering how to actually make the numbers work, you’re not alone.

Here’s the good news: there’s a financing tool that might be the bridge between you and your next home. It’s called a 2-1 buydown, and it could give you both breathing room today and flexibility for tomorrow.

What is a 2-1 buydown? Think of it as a way to ease into your mortgage. With a 2-1 buydown, your interest rate is 2% lower in the first year and 1% lower in the second year. After that, it goes back to your original locked-in rate. Instead of being hit with the full payment right away, you can settle in with smaller payments for the first couple of years.

Why sellers often pay for it. Here’s the part buyers love: in many cases, the seller covers the cost of the buydown. With higher rates making buyers harder to find, most sellers would rather offer a concession than lower their asking price. With the right agent negotiating on your behalf, you could have the seller fund your buydown and enjoy the discount.

What happens when rates drop? Most experts believe rates will come down within the next couple of years. If that happens, you can refinance into a lower rate when your buydown period ends. That means you’re not stuck with today’s rates forever—you’ve got options.

If you’d like to see how a 2-1 buydown could work in your situation, give me a call at (719) 351-4312 or send me an email to jeffryder@kw.com. Let’s find a way to make your homeownership plans achievable, even in today’s market.