By Paul Domenech
Truth be sold: 2/1 rate buydowns might sound attractive, but they can cost you more in the long run, especially if you’re not prepared for what happens next.
Here’s the deal: You’re told you can “buy down” your interest rate and save $240 a month in your first year. Sounds great, right? Until year two hits, and your payment jumps from $1,700 to $1,950. Meanwhile, if you had negotiated that same buy-down cost off the purchase price instead, your mortgage would’ve been $1,880, every year, consistently. Predictable. Budgetable.
That’s not just a math lesson; it’s a mindset warning.
You’ve probably heard the saying: “Marry the house, date the rate.” Cute, but terrible advice if you ask me. You wouldn’t run a household like a casual relationship. If you’re planning to buy a home, arguably the biggest financial commitment of your life, you need to approach it like a responsible, long-term investment, not a temporary fling.
The reality? Many people who were sold on rate buydowns or the hope of refinancing in 2024 are now stuck. Rates didn’t drop the way they were promised. Equity hasn’t climbed the way it used to. And that “refi later” strategy? It’s left a lot of folks feeling trapped, stressed, and financially stretched.
Then there’s the tax hit no one talks about. If you bought with the plan to “get in now and sell when things are better,” and end up selling in under two years—boom, you could be facing capital gains taxes. Because you didn’t live in the home long enough to qualify for the exclusion.
And that’s not all. Watch out for lender fees buried in flashy “first-time buyer” or “veteran programs.” There’s no magic lender out there just for veterans. Some are veteran-owned, yes, but that doesn’t always mean better terms. Sometimes that lower rate comes with padded closing costs. A great lender is someone who answers the phone, charges no junk fees, and offers solid options with full transparency,no matter who you are.
Here’s our promise: Whether you’re buying, selling, or just need to make sense of the chaos—we’ll give you the truth. Not a pitch. Not a gimmick. Just the information you need to make a smart, sustainable decision for you and your future.
Call us at 850-543-1418 or visit TheDomenechGroup.com. We’ll help you cut through the noise and point you in the right direction—even if we’re not the group you choose to work with.
Because sometimes the truth isn’t sold. It’s given.
And that’s exactly what we do.
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