My clients were first-time buyers who already knew where they wanted to live: a new-construction community in Vancouver. They didn't need help finding a house. They called me in early 2025 because a builder's contract is written by the builder, and they wanted someone on their side of the table before they signed it.
The first part of the work was the ordinary kind that matters most. We went through the purchase agreement line by line. We compared the home against other new construction nearby, so they knew what the same money bought elsewhere. And we stress-tested their assumptions: the payment at different rates, how long they planned to stay, and what they wanted the house to do for them financially over the next decade.
The home had been on the market for more than five months, and the builder was offering an incentive worth 5% of the price, about $38,000. Like most builder incentives, it came with a condition: the buyers had to finance through the builder's preferred lender.
That's where it got interesting. My clients had a lender they already knew and trusted. When we compared the two loans side by side, same product and before any buydown, their lender's rate was about half a percentage point lower, with roughly $2,800 less in origination fees. On their loan, that rate difference comes to about $190 a month.
So the default path offered two choices: take the incentive with the builder's lender and pay more every month, or use their own lender and give up $38,000. Most buyers pick one and move on.
I asked the builder for a third option: the full incentive, with the buyers' lender. The first answer was no. Preferred-lender arrangements exist for real reasons on the builder's side, and I understood why the default was firm. I kept making the case. The lender was established and professional, the buyers had a real relationship with them, and the savings to the buyers were substantial. The working relationship I'd built with this builder helped too. To their credit, they made an exception.
If they had held at no, my recommendation would have been to take the incentive with the preferred lender and plan to refinance later. That was a reasonable fallback, and the call would have been the buyers'. It would have meant a higher payment in the meantime, plus the cost of the refinance.
With the incentive secured, the next question was how to use it. The buyers could put all $38,000 toward the price, all of it toward a permanent rate buydown, or split it. I advised against going all-in on either. Putting everything into the buydown gives the lowest payment, but if rates fell in the next year or two and they refinanced, the buydown's value would stay with the old loan. Putting everything into the price barely moves the monthly payment, and it sets a lower sale price for the neighborhood, which shows up in future appraisals for them and their neighbors.
They put about $20,000 toward the price and about $18,000 toward the buydown. At roughly $739,000, they were comfortable with where their equity would likely land, and because they planned to stay long term, the buydown brought the monthly payment to a number they felt good about.
For anyone buying new construction: the incentive and the conditions attached to it are both worth asking about, and it's worth running the builder's lender against your own before you decide which one to use.
