Buying a home is exciting, but those first mortgage payments can shock the system. The pressure is real for military families already juggling moves, deployments, and tight budgets. That’s why AAFMAA Mortgage Services LLC (AMS) created the limited-time Lender Buydown Advantage. It’s a smart way to cut your interest rate for the first year, giving you extra breathing room (and maybe even a little fun money) as you settle into your new home.

With this program, AMS will cover the cost of buying down your interest rate by 1% for the first year of your mortgage. Whether using a VA Home Loan, a conventional mortgage, or an FHA loan within conforming loan limits, this benefit could help you save thousands of dollars during that critical first year of homeownership.

Related: How Much Down Payment Do I Need to Buy a House

What Is a Lender Buydown?

A buydown is a mortgage financing arrangement that temporarily lowers the interest rate on your loan by paying a fee up front to lower the rate. Typically, the homebuyer (borrower) or the seller covers the cost. In this case the lender is covering the cost for the buydown. “The biggest thing is it gives you flexibility to structure your finances for the transition to homeownership,” says Rick Maines, Vice President of  Sales at AMS. “People moving into a new home often incur a more expensive mortgage payment. This gives them a little time to get used to it and plan ahead.”

With the AMS Lender Buydown Advantage, the homebuyer gets a 1-0 buydown. That means your interest rate is reduced by 1% for the first 12 months of your mortgage. AMS sets aside the money to cover the difference in your monthly mortgage payment for the first year. After the first year, your payments will be adjusted to the original amount based on the note rate for the remainder of the loan term. Be sure to check the APR on your loan which reflects the total cost you are paying on your mortgage. 

“The real benefit is that it eases the transition into your new home by lowering your initial payments, freeing up money in that first year to pay off debt, make upgrades, or cover the other expenses new homeowners get hit with,” says Maines. “And here’s the key difference: unlike many buydown programs, where the borrower pays for the reduction, AMS pays the cost on your behalf. That’s real savings, right when you need it most.”

Related: 5 Things to Know About VA Home Loans for 2025

Why the Lender Buydown Advantage Matters Right Now

Today’s higher-rate environment makes affordability one of the biggest concerns for homebuyers. It’s not surprising that many families are hesitating to move forward, worried that locking in at today’s rates could stretch their budgets too far. The Lender Buydown Advantage is designed to remove some of that pressure by creating a financial “bridge” during the first year of homeownership.

This program immediately creates meaningful monthly savings by temporarily lowering your interest rate by 1% in year one. That extra cash can help cover moving expenses, childcare, household upgrades, or other debts. That flexibility can be invaluable for military families adjusting to new duty stations or life after service.

“If you use this offer correctly, you can position yourself to get the lower rate now while hedging against the gamble that rates may continue to go down,” says Maines. “And unlike an adjustable-rate mortgage, you don’t have the uncertainty. Here, you know exactly what your payment will be after the first year.”

Adjustable-rate mortgages (ARMs) may start with lower payments, but they come with long-term unpredictability. If rates go up, so will the ARM's rate and monthly mortgage payment. The Lender Buydown Advantage offers the best of both worlds: lower first-year payments paired with the stability of a fixed-rate mortgage.

A Smart Alternative to Permanent Buydowns

Some buyers consider paying points up front to lower their rate permanently. But as Maines points out, that can backfire if rates decline:

“Nobody wants to spend thousands of dollars to buy their rate down today, only to see the market shift and realize they could have gotten the same or better rate later at little to no cost,” Maines explains. “With the AMS program, you don’t shoulder that expense—AMS does. That means you keep your money free for other priorities while still enjoying meaningful short-term savings.”

One of the best parts of the Lender Buydown Advantage is that it keeps your options open. If interest rates fall in the coming months or years, you may be able to refinance into a lower permanent rate without the regret of having spent thousands of dollars on points up front. You’ve saved money in year one and still preserved the ability to take advantage of better market conditions later.

On the other hand, if rates hold steady or even rise, you haven’t lost anything. You still benefited from a full year of lower payments, which gave your family extra breathing room to adjust to the new mortgage. That makes the program a win-win: you enjoy immediate savings now while protecting your financial flexibility for the future.

Real-World Example of Savings

Let’s look at a $400,000 VA Home Loan to buy a home with no down payment (100% financing eligibility) as an example of what this might save you.

At 6.125% (APR = 6.350%), the monthly principal and interest payment, not including taxes and insurance, is about $2,483. With the 1% buydown, the first-year payment is based on 5.125%, or about $2,225. This assumes a VA Funding Fee = $8,600 (2.15%) included in the loan amount for a total loan amount financed of $408,600 and total of payments = $893,771. That’s a monthly savings of $258. Over 12 months, thanks to AMS covering the cost, you’d save about$3,095. When getting a VA Home Loan to buy a home, there are other costs and fees that must be paid up front. Be sure to ask your mortgage advisor for complete details. Also, check out the Lender Buydown Advantage disclaimer here.

Related: Top 8 Questions Military Homebuyers Ask

Flexible, Fast, and Available Now

The Lender Buydown Advantage is available to buyers in all states where AMS does business. “But this offer ends November 30, 2025, meaning your loan must be in motion by then, so if it interests you, consider moving quickly,” advises Maines.

While every loan timeline depends on factors like appraisal and documentation, he notes that the average turnaround time is 30 days.

Get Started Today

In today’s higher interest rate environment, the Lender Buydown Advantage is a powerful way to achieve your homeownership goals without delay. Instead of waiting on the sidelines and hoping for rates to fall, military families can move forward now with a little extra peace of mind. “It’s just an additional tool in financial planning that the homebuyer doesn’t have to pay. The real benefit is flexibility. It gives you a softer landing in that first year of homeownership when expenses are often highest, and it allows you to plan confidently,” says Maines.

Whether you’re moving up to a bigger home, buying near a new duty station, or transitioning out of active duty, this program helps bridge that financial gap without locking you into a strategy that could backfire later. “By covering the 1-0 buydown cost, AMS takes on the risk so you don’t,” he adds.

For families navigating moves, deployments, or retirement transitions, that can mean the difference between stretching uncomfortably and settling in securely.

We’re Here to Help

Whether you’re thinking about buying, ready to start home-shopping in earnest, or considering a refinance, an AMS Military Mortgage Advisor, a licensed mortgage loan originator, will be happy to provide you with an honest and fair comparison of your mortgage options, including a wide range of affordable mortgages designed to meet your needs.

Ensuring Armed Forces Mutual Members obtain the best mortgage possible is our mission. Get your free mortgage assessment today or give us a call at 844-422-3622!