When making a large purchase, many consumers need financial assistance.  Companies like Wells Fargo, GE Capitol, American Express, Green Sky and local banks will provide this assistance.  When given an opportunity to finance, many times the customer will pay much more to get a better system. 

Unfortunately, the usual revolving rate for these types of loans can be up to 29.99%.  And in the case that the customer would take your financing assistance, they would most likely say "NO" to a 29.99% loan.  

This is where the buydown rate comes in.  Most financial institutions like the ones mentioned above will allow the contractor to "buy down" the rate from 29.99%, to some lower rate that a consumer would accept.  Such as 3.9% for 60 months, or 9.9% for 72 months.  

Everyone gets to win here.  Ultimately the consumer is just pre-paying a finance charge to get a better Annual Percentage Rate.  This rate usually comes with a cost.  It can be anywhere from 3% up to as much as 20% of the cost of the transaction.  

So in our program, under the company defaults area, you can enter the typical rate you want to add to your system price.  We use a margin on this and not a mark-up.  

Example.  A $10,000 system that has a 10% buydown rate will cost you $1,111.  So the ultimate selling price to the consumer is $11,111.  When you get your check, it will be for $10,000.  That is $11,111 less 10% or $1,111.  

In the picture above you can see in the four quality levels there is a possibility of setting a varying level of cost to the level.  You can base this on what you want to offer, other costs such as manufacturers shared rebate costs, and even in the case of some States, applying State tax to the entire job.