The 3-2-1 mortgage interest rate buydown is an innovative approach where the seller pays an upfront fee to temporarily

reduce the borrower's interest rate for the initial years of the loan.

Specifically, the interest rate is reduced by 3% in the first year, 2% in the second year, and 1% in the third year, after which it reverts to the original rate.

This strategy allows buyers to enjoy lower monthly payments in the early stages

of homeownership, as they settle

into their new home.