What is a mortgage rate buydown and does paying for one make sense in 2026?

A buydown lowers your interest rate, either temporarily or permanently, in exchange for an upfront cost. A permanent buydown (discount points) costs roughly 1% of the loan per point and shaves the rate for the life of the loan; it pays off only if you keep the loan long enough to recoup the cost. A temporary buydown, like a 2-1, cuts the rate for the first year or two then steps up — often paid by a seller or builder to make a high-rate payment feel manageable early. In 2026's rate environment, sellers and builders frequently offer these as concessions. Compare the upfront cost to monthly savings and your expected time in the home at wealthserene.com/tools/refinance-analyzer or a points calculator before paying.