See the payment steps, the full ongoing payment and the estimated subsidy needed at closing. A temporary buydown does not change the mortgage note rate.
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A temporary subsidy can reduce the borrower’s out-of-pocket principal and interest for an introductory period. It does not make the note rate permanently lower. Compare eligible uses of the same seller or builder contribution, including closing costs or a permanent rate buydown.
For eligible Fannie Mae loans, qualification uses the note rate rather than the temporary reduced payment rate. Program eligibility, funding sources and contribution limits must be checked for your specific loan. Review Fannie Mae’s temporary-buydown rules.
No. A temporary subsidy covers part of scheduled payments for a limited period. Discount points are an upfront pricing choice associated with the note rate. See our complete buydown guide.
The treatment of unused subsidy funds depends on the agreement and applicable program rules. Do not assume they are automatically paid to you. Ask for the written terms before closing.
No. Future rates, property value and eligibility are uncertain. Evaluate whether the full scheduled payment fits your budget from the beginning.
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Bring your scenario or Loan Estimates to Michael Shotnik at Milestone Home Mortgage. We can compare eligible options, explain the tradeoffs, and help you decide what deserves a closer look.
Prepared for Milestone Home Mortgage • October 13, 2026. Michael Shotnik NMLS 218281 | Milestone Home Mortgage LLC NMLS 2588937 | Equal Housing Opportunity. Educational estimates only, not a rate quote, approval or commitment to lend. Actual terms, costs and eligibility vary.
Michael and Melissa are always a pleasure to work with. They are extremely responsive, professional and work hard to get the best loan for us. I would recommend Colorado Mortgage to anyone. Thank you for another great experience!
Milestone Home Mortgage LLC NMLS #2588937. Michael Shotnik NMLS: 218281, CO License: 100017466. Not licensed in Alaska or New York. To check license status of mortgage loan originator, visit D.O.R.A. and NMLS consumer access.
