"Standby commitment (also known as forward commitment) agreements between a builder and lender for blanket interest rate coverage that are executed prior to signing a sales contract with a borrower are not subject to Fannie Mae's maximum financing concessions because they are not attributable to the specific loan transaction."
That sentence sits in a note in the Fannie Mae Selling Guide, and it explains much of McKinney's fall 2026 market. As of October 8, 2026, Freddie Mac's weekly survey put the average 30-year fixed rate at 7.40%, up from 6.30% a year earlier. At the same time, new-home communities in and around McKinney are advertising rates more than two percentage points lower. A resale seller down the road can cut the price, fix up the house, or pay toward closing costs. What the seller can't do is buy the buyer's rate down by the same amount. The reason is a rule about who pays for the lower rate and when that deal gets signed.
The Rule That Puts a Ceiling on Resale Sellers
When a seller pays to lower a buyer's interest rate, Fannie Mae counts that money as an interested party contribution. It applies to temporary buydowns and permanent ones alike. The total is capped. Under Selling Guide section B3-4.1-02, the cap depends on how much the buyer borrows compared with the home's value.
| Loan type | Seller contribution cap |
|---|---|
| Conventional, primary home, LTV above 90% | 3% |
| Conventional, LTV 75.01% to 90% | 6% |
| Conventional, LTV 75% or less | 9% |
| Conventional, investment property | 2% |
| FHA | 6% of sales price |
| VA, seller-funded temporary buydown | 4% of reasonable value |
The FHA figure comes from HUD Handbook 4000.1. It covers closing costs, prepaids, discount points, and both temporary and permanent buydowns. HUD's handbook page also lists an August 2026 redline, so lenders should confirm the current language. The VA figure comes from the VA's temporary buydown guidance. Fannie Mae figures its caps from the lower of the sales price or the appraised value. Contributions also can't be more than the buyer's actual closing costs.
A builder can set up a blanket rate arrangement with a lender before any buyer signs a contract. Under the Fannie Mae note quoted above, that arrangement doesn't count against these caps. A homeowner selling one house has no way to set that up. Each resale deal is negotiated one contract at a time, and every dollar spent on a buydown counts toward the limit.
What the Advertised Offers Say in the Fine Print
The difference is easiest to see on actual McKinney-area offers, as advertised in October 2026.
At Painted Tree Woodland District, CB JENI Homes shows a headline of "3.99% (5.649% APR) FHA Low Intro Rate." The disclosure says the rate was provided 09/30/2026 and that it's a 1/0 buydown. The rate is 3.99% in year one and 4.99% for years 2 through 30. Their example is a $320,000 price with 3.5% down. That works out to principal and interest of $1,498.25 a month in the first year and $1,684.80 after that. The offer applies to select homes at Painted Tree Woodland West, requires the builder's preferred lender, and may be discontinued without notice. The same page lists quick move-in homes priced from $317,720 to $399,990.
At Aster Park near McKinney, Ashton Woods advertises fixed rates "as low as 4.99% (APR 5.20%)" and up to $10,000 in closing costs on select quick move-in homes. The page doesn't show an expiration date.
Trophy Signature Homes lists price reductions on McKinney inventory homes, including $6,000 off a home in Southridge and $8,000 off one in Eastridge. Its "Back to School Savings Event," with a 5.25% rate and free appliances, required a contract by 9/30/26, so it's closed to new buyers. At Trinity Falls, the community's own inventory page showed 35 available homes from several builders, starting at $342,990.
Two details matter when comparing these with a resale listing. First, the 3.99% headline lasts only one year. The rate a buyer actually lives with is 4.99%, and that's still well below the 7.40% national average. Second, Fannie Mae requires buyers with a temporary buydown to qualify at the full note rate, not the lower first-year rate. So the first-year discount lowers the payment, but it doesn't raise the loan amount a buyer qualifies for.
The Resale Seller's Math
Start with McKinney's September 2026 median single-family sale price of $472,500, from the NTREIS summary prepared by the Texas Real Estate Research Center at Texas A&M. Say the buyer's conventional loan puts them above 90% LTV. The 3% cap allows about $14,175 in total seller contributions, and that same money also has to cover closing costs.
The CFPB defines a discount point as 1% of the loan amount. It says how much a point lowers the rate depends on the lender, the loan type and the market. In its worked example, 0.375 points on a $180,000 loan lowers the rate from 5.00% to 4.875%. That's one-eighth of a percentage point. The CFPB presents that as an illustration rather than a formula, and actual point pricing comes from each lender. The gap between 7.40% and a 4.99% builder rate is 2.41 percentage points, nearly twenty times the reduction in that example, and any points a resale seller pays come out of the same capped $14,175.
Here's what that gap means in monthly payments. These are standard amortization figures for principal and interest only, on the same 30-year, $400,000 loan:
| Rate | Monthly principal and interest |
|---|---|
| 7.40%, Freddie Mac average as of Oct. 8, 2026 | about $2,770 |
| 4.99%, advertised builder rate | about $2,145 |
That's a difference of roughly $625 a month. Whatever a lender charges to narrow it, a resale seller's share has to fit under the caps above. Price is the lever that's left. Lowering the price shrinks the loan at whatever rate the buyer gets, and it doesn't count toward any contribution cap.
What McKinney's September Numbers Show
The rate gap helps explain why the city's MLS figures look the way they do. For McKinney single-family homes in September 2026, NTREIS reported:
- 191 closed sales, down from 257 in September 2025
- 147 pending sales, down from 234
- 289 new listings, down from 346
- 766 active listings and 3.5 months of inventory, compared with 872 and 3.9 a year earlier
- 54 days on market, down from 65
- 93.6% of list price received at sale, up slightly from 93.0%
Buyers are signing fewer contracts, and fewer sellers are listing. Homes are closing at an average of 6.4% under list price. That gap between list and sale price is where much of the resale negotiation now happens. In August 2026, the same series showed a $490,000 median, 55 days on market and 94.1% of list price.
These figures come with two caveats. NTREIS includes both new and existing homes sold through the MLS, and it leaves out sales builders make directly outside the MLS. So the numbers above aren't a pure resale count, and they miss some of the builder activity this post is about. Other sources also measure differently. Community Impact's August 2026 McKinney report counted 252 homes sold, a $507,000 median and 69 average days on market.
Where a Resale Listing Still Has Room
The cap scale rewards bigger down payments. A conventional buyer who borrows 90% or less of the home's value moves from the 3% tier to the 6% tier. At 75% or less, the cap rises to 9%. For a move-up buyer using equity from a previous home, that can roughly double or triple what a resale seller is allowed to contribute. A buyer like that can also qualify on the rate at their own pace, without a builder's preferred lender being part of the deal. The CB JENI offer, for example, requires that lender to get the buydown.
The builder offers are also limited. They apply to select quick move-in homes, while funds last, and they can change without notice. Trophy Signature's September event shows how fast an offer can expire. The rate gap can shrink one community at a time with no warning, so a resale pricing plan built on today's builder offers should be checked against them again before each price change.
Quick Answers
Is a 1/0 buydown the same as a 3.99% mortgage? No. In the Painted Tree example, the rate is 3.99% for the first year and 4.99% for the remaining 29 years, with a disclosed APR of 5.649%.
Can a resale seller offer a temporary buydown? Fannie Mae allows it, counts the cost toward the seller's contribution cap and limits temporary buydowns to a reduction of no more than 3 percentage points, increases of no more than 1 point a year, and a period of no more than three years.
Do FHA buyers see different rates? In the Mortgage Bankers Association's survey for the week ending October 2, 2026, the average rate was 7.14% for FHA 30-year fixed loans and 7.49% for conforming loans.
If you're selling a McKinney home this fall, your price is up against the builder rates a few miles away. Lori Seale can put your home next to the current builder offers and recent closed sales so your pricing reflects what buyers are actually choosing between. Start with Get Your Home Valuation, and we'll take it from there together.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
