Can the seller buy down the VA rate?
Yes. Seller-funded temporary buydowns (2-1, 3-2-1) and permanent buydowns are allowed on VA, subject to the 4% seller concession cap. The lender structures the buydown and the cost shows on the Closing Disclosure as a seller credit.
What this actually means.
Two structures: 1) temporary buydown — seller pays an escrowed amount that reduces the borrower's payment in years 1 (and 2 and 3 in 3-2-1) and reverts to the note rate after; 2) permanent buydown via discount points the seller funds. The 4% seller concession cap applies. Buydowns are useful when sellers want to support the deal but won't drop price further. Subject to VA guidelines.
Where this can move.
Credit score, loan amount, LTV, points, lender credits, lock timing, and market movement can change the rate quoted. The funding fee adds to APR.
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More VA questions on Rates.
Educational only. VA guidelines, lender overlays, rates, fees, and underwriting requirements can change. Final eligibility depends on full underwriting review. Mortgage Expert, Inc. is not affiliated with the VA, HUD, or any government agency.