Rate Buydown vs. Price Reduction
Which Seller Concession Wins?
See how a seller-paid rate buydown compares to a straight price cut — and which saves your buyer more each month.
0.25% rate reduction per 1% concession
30-Year Fixed P & I
Property & Loan Details
Offer Amount
Down Payment
Seller Credit
Loan Amount
Scenario A
Seller Pays Rate Buydown
$
$
$
$
Scenario B
Seller Reduces the Price
$
$
$
$
How it works: Each 1% of seller concession applied as a rate buydown reduces the interest rate by approximately 0.25% from the base rate set above. Scenario A applies the seller credit to discount points. Scenario B subtracts the seller credit dollar amount from the purchase price. Edit each row's Seller Credit field directly.
Scenario A
Seller Pays Rate Buydown
Concession applied to discount points
Offer Amount—
Seller Credit—
Bought-Down Rate—
Down Payment—
Loan Amount—
Monthly P & I—
Scenario B
Seller Reduces the Price
Concession subtracted from purchase price
Adjusted Price—
Price Reduction—
Interest Rate—
Down Payment—
Loan Amount—
Monthly P & I—
Monthly Payment Difference
Enter your numbers above to see the comparison.
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Important Disclosure: This calculator is for illustrative and educational purposes only. All figures reflect principal & interest only and do not include property taxes, homeowner's insurance, HOA fees, mortgage insurance, or other escrow items. Actual loan terms, rates, and payments are subject to credit qualification, underwriting approval, and market conditions at time of closing. Rate buydown calculations assume 1 discount point = 1% of loan amount with a 0.25% rate reduction per point — an approximation that may vary. Consult your licensed mortgage professional for a complete Loan Estimate. Steve Tomaselli | NMLS 358920 · Licensed in TX, FL & MA.
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