Buydowns in Relation to CMBS Loans

CMBS Loans and Interest Rate Buydowns

If you’re a CMBS loan borrower who wants to decrease the interest rate of your loan, you may be able to do so by purchasing an interest rate buydown. Buydowns involve paying upfront to purchase points on your mortgage in order to lower its interest rate. For example, a lender may allow you to pay 1% of the entire loan amount upfront to reduce your interest rate by 0.5%.