Couple in front of New Home 03

When you buy a home, there are two big money things to think about:

  1. How much your monthly payment will be.
  2. How much interest you will pay to the bank over time.

Most buyers know sellers sometimes give credits to help pay closing costs. But here’s something many people don’t realize…

You can often use seller credits to buy down your interest rate instead  and that can save you thousands of dollars over the life of your loan.

Let’s break it down simply.

What Is a Seller Credit?

A seller credit is money the seller agrees to give the buyer at closing.

Think of it like a coupon from the seller to help make buying the home easier.

That money can usually be used to:

  • Pay closing costs
  • Or pay extra upfront to get a lower interest rate

What Does “Buying Down the Rate” Mean?

Buying down the rate means paying a little extra money at closing so the bank gives you a lower interest rate on your mortgage.

It’s like paying more for a movie ticket so you get free popcorn every time you go except this saves you money every month for years.

Lower rate = lower payment.

Why Use Seller Credits to Buy Down the Rate?

Instead of using the seller’s money only for closing costs, you might choose to:

✔ Lower your monthly payment
✔ Save tens of thousands in interest over time
✔ Make your home more affordable long-term
✔ Keep more money in your pocket

Simple Example

Let’s say the seller gives you $10,000 in credits.

You could:

  • Use it to pay closing costs… or
  • Use it to lower your rate.

If that rate drop saves you $300 per month, that’s:

  • $3,600 per year
  • $36,000 over 10 years

That’s real money.

Why This Matters in Today’s Market

In today’s market, many sellers are more willing to give credits especially if a home has been sitting on the market.

Smart buyers use those credits strategically, not just to close the deal, but to make the home cheaper every month.

The Bottom Line

Seller credits are powerful.

Used one way, they help you get into the home.
Used wisely, they can make your mortgage cheaper for years.

That’s why working with a knowledgeable loan advisor matters. The right strategy can save you far more than most people expect.

Ready to See Your Options?

If you’re thinking about buying a home, let’s run the numbers.

I can show you:
• How seller credits could lower your rate
• How much your payment could drop
• Your best long-term strategy

Schedule a quick call or message me today and let’s make your home purchase work smarter for you.

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