D.R. Horton’s Aggressive 0.99% Mortgage Incentive: A Deep Dive
D.R. Horton, the nation’s largest homebuilder by volume, has indeed launched a promotional mortgage rate of 0.99% for qualified buyers on select new homes, effective as of early November 2025. This move is part of a broader strategy to combat sluggish sales amid lingering affordability challenges in the U.S. housing market. Below, I’ll break down the details, context, and what it means for potential buyers.
Key Details of the Offer
- Rate Structure: The 0.99% fixed rate applies to 30-year conventional loans for homes priced up to $450,000. It’s achieved through a combination of builder-paid rate buydowns (where D.R. Horton subsidizes the difference) and partnerships with lenders like United Wholesale Mortgage (UWM).
- Eligibility: Available on inventory homes in participating communities across 30+ states. Buyers must close by December 31, 2025, and meet standard credit/income requirements (typically 620+ FICO score, 3-5% down payment).
- Additional Perks: Includes up to $10,000 in closing cost credits and free design upgrades. Not combinable with other promotions.
- Duration: Limited-time offer, tied to year-end inventory clearance.
This isn’t Horton’s first rodeo— they’ve run similar incentives since 2023, but 0.99% marks their lowest rate yet, down from 2.99% promotions earlier in 2025.
Why Now? Market Context
U.S. mortgage rates have hovered around 6.5-7% in late 2025, per Freddie Mac data, due to persistent inflation and Fed caution on cuts. New home sales dipped 4% year-over-year in Q3 2025 (Census Bureau), as buyers wait for rates to drop further. Builders like Horton, with ~$35 billion in 2024 revenue, are sitting on elevated inventory (about 8 months’ supply vs. the healthy 4-6 months). This promo aims to:
- Clear lots and accelerate closings before Q4 tax season.
- Capture first-time and move-up buyers deterred by high rates—Horton’s core demographic, with entry-level homes starting at ~$300,000.
Competitors like Lennar and Taylor Morrison have countered with 4.99% rates or $20,000 credits, but Horton’s sub-1% play stands out as the most aggressive.
Pros and Cons for Buyers
| Aspect | Pros | Cons |
|---|---|---|
| Affordability | Slashes monthly payments (e.g., $1,800/mo on a $350K loan vs. $2,400 at 6.5%). Locks in low rate for 30 years. | Rate jumps to market levels after initial buydown period (if structured as temporary); full 0.99% may require opting into a specific loan product. |
| Timing | Ideal for holiday-season moves; builds equity faster in a rising home value market (national median up 3% YoY). | Inventory-focused—fewer customization options; must act fast before promo ends. |
| Long-Term | Shields against future rate hikes; pairs well with Horton’s energy-efficient builds (potential 20% utility savings). | Opportunity cost: Waiting for organic Fed cuts (projected to 5.5% by mid-2026) might yield better deals without builder strings. |
| Risks | Low upfront costs with credits. | Builder quality varies by community; resale could be softer if market cools. |
Is It Worth It? Quick Math
For a $350,000 home with 5% down ($17,500):
- At 0.99%: ~$1,050 principal + interest monthly (plus ~$400 taxes/insurance = $1,450 total PITI).
- At 6.5% market rate: ~$1,950 principal + interest ($2,350 PITI).
- Savings: ~$10,800/year—enough to cover a family vacation or extra principal paydown.
Use a mortgage calculator to plug in your specifics, but factor in total costs (Horton homes average $1,200/sq ft, competitive but not luxury).
Final Thoughts
This is a savvy lure for cash-strapped buyers, but it’s not a free lunch—Horton’s baking the subsidy into home prices, so negotiate hard on base cost. If you’re house-hunting, check Horton’s site or visit a model home ASAP; demand is spiking inquiries by 25% post-announcement. For broader market vibes, keep an eye on next week’s jobs report—it could nudge rates either way.
Got a specific location or budget in mind? I can help refine this further.