ARLINGTON, Texas–The nation’s largest home builder is now dangling a sub-1% mortgage rate—but there’s a catch, even though it remains a good deal.
As part of a promotion, D.R. Horton’s financing arm, DHI Mortgage, is currently offering a 0.99% mortgage rate for buyers of homes in select communities in Texas.
To get the rate the loan has to close on or before Dec. 31st, and there are some other strings, too, not surprisingly.
D.R. Horton, which, as the CU Daily reported here has been using rate buydowns to help maintain the pace of sales, is using the deep rate reduction over reducing the prices of homes, which can hurt housing development, appraisals and recent buyers.
The .99% offering can be applied to some properties in Texas as well as Florida. It’s being used in developments where inventory has been slow to move.
How it Works
But the 0.99% mortgage rate isn’t fixed. In year two, the rate increases to 1.99%, and in year three, it’s 2.99%. It rises to 3.99% in year four and remains there for the remainder of the loan term, which is still an attractive rate, well below the prevailing current rates north of 6%.
