If you’re trying to buy or sell a home in today’s high-interest rate environment, you’ve probably asked yourself:
Is now even a good time to make a move?
The good news? With the right strategy, the answer could absolutely be yes—and rate buy downs might be the key to making it happen.
In a recent interview with Michelle Kattula, Senior Loan Advisor at Aequitas Mortgage Inc., we broke down how rate buy downs and creative financing can make homeownership more affordable and help sellers attract more qualified buyers.
Let’s explore the highlights.
A rate buy down is a financing strategy that reduces your mortgage interest rate—either temporarily or permanently—in exchange for an upfront payment.
That payment can come from:
The buyer
The seller (as an incentive)
The lender (via premium pricing)
Lower rate = lower monthly payment. And in 2025, that matters more than ever.
Michelle explained the two main types:
You pay upfront to lower your interest rate for the entire life of the loan. Best for long-term homeowners.
A step-up structure that lowers your rate for the first 1–3 years. For example:
2-1 Buydown:
Year 1: 2% lower
Year 2: 1% lower
Year 3+: Standard rate
3-2-1 Buydown:
Year 1: 3% lower
Year 2: 2% lower
Year 3: 1% lower
Year 4+: Standard rate
Great for buyers expecting income growth or future refinancing.
Sellers often think lowering the price is the best way to attract buyers. But Michelle explained that a $10,000 price cut might save a buyer $64/month, while a $10,000 rate buydown could save $200–$300/month.
Same net result for the seller. Much better value for the buyer. That’s a win-win.
In addition to rate buydowns, Michelle also shared several tools buyers and sellers can use:
Seller-paid closing costs
Adjustable-Rate Mortgages (ARMs)
Grants & down payment assistance
Assumable FHA or VA loans
Piggyback HELOC loans (to avoid PMI)
Bridge loans (for move-up buyers)
All of these can be part of a personalized strategy when working with the right mortgage broker.
One of the biggest mistakes buyers make in today’s market is sitting on the sidelines waiting for interest rates to drop. It feels logical—why not hold out for a lower rate and a better deal?
But here’s the reality: waiting often ends up costing you more.
As Michelle pointed out in our interview:
📈 Home prices are still rising, especially in desirable areas like Lakewood Ranch and Sarasota. Even if rates drop in 6–12 months, that home you loved may be $30,000–$50,000 more expensive by then.
🔁 When rates go down, buyer demand surges. We’ve seen it before: more buyers re-enter the market, and the competition ramps up. Suddenly, you’re back in multiple-offer situations, waiving inspections, paying over asking—and losing leverage.
💸 Refinancing is always an option. If you can afford the payment now with a creative financing strategy (like a temporary rate buy down), you can always refinance later when rates come down. That’s the “date the rate” part.
👉 The smarter play is to buy the right home now—at the right payment—and lock in equity before the next surge of buyer activity. Don’t let short-term rate fears stop you from making a long-term wealth-building decision.
f you’re selling a home right now, here’s one hard truth: Buyers are payment-sensitive.
Interest rates in the 6.5–7.25% range have priced out many would-be buyers, and those who are still active are laser-focused on monthly affordability.
That’s where rate buy downs come in as a powerful marketing tool.
Instead of lowering your asking price—which only saves the buyer a modest amount per month—you can offer a seller-paid rate buy down and create real financial incentive to choose your home.
✅ “Own This Home for Less Per Month – Ask About Seller Credits!”
These headlines catch the eye of serious buyers and help your listing stand out in a crowded market.
Best of all? You get the same net proceeds from the sale—but your home becomes significantly more attractive in buyers’ eyes. It’s a strategic move that can reduce days on market, avoid future price reductions, and put your home at the top of the list.
📣 Pro tip: Pair this strategy with strong visuals and clear messaging in your MLS listing and social media posts to drive interest and urgency.
Rate buy downs and creative financing tools are underused but incredibly effective in today’s market. Whether you’re buying or selling, understanding these options could be the difference between a frustrating experience—or a winning deal.
I specialize in helping buyers and sellers navigate today’s market with confidence. Whether you’re looking to buy in Lakewood Ranch, Sarasota, or anywhere along the Florida Gulf Coast, let’s talk.
📆 Book your free home buying consultation:
👉 https://thevillageguruflorida.com/proven-buyer-process/
📩 Or email me directly: jeff@thevillageguruflorida.com
Michelle Kattula
Senior Loan Advisor | Aequitas Mortgage Inc.
📞 586-383-3538
📧 mkattula@aequitasmortgage.com
📍 Licensed in FL, MI, TX