Stylecraft's Killeen communities, McGregor Estates and The Reserve at Turnbo Ranch, advertise a 4.49% rate in large type. Stylecraft's disclosure lists an APR of 6.879% and calls the loan a 5/1 adjustable-rate mortgage. A few miles away at Turnbo Ranch, D.R. Horton advertises 5.50%, and that one is a 30-year fixed. Meanwhile, resale sellers in the same zip codes are paying buyers' closing costs and rate buydowns to keep up. Killeen's buyer's market this fall is mostly a competition over financing terms, and the rate printed on the banner is the least useful number in it.
An ARM, a Fixed Rate and a Price Cut
Here are the current builder offers side by side, using each builder's own fine print.
| Builder and community | What's advertised | What the loan actually is | Deadline | Lender required |
|---|---|---|---|---|
| Stylecraft, McGregor Estates and The Reserve at Turnbo Ranch | 4.49%, or up to $25,000 "Your Way" | 5/1 ARM, builder-paid initial rate, fixed for five years, 6.879% APR in the example | Loans closed by November 30, 2026 | Kangaroo Home Lending |
| D.R. Horton, Turnbo Ranch and other select Texas communities | 5.50% | 30-year fixed, 5.657% APR in the VA example, drawn from a limited pool of funds | Contract on or after October 1, 2026, close by January 29, 2027 | DHI Mortgage |
| Lennar, greater Temple/Killeen area | Up to $20,000 off price plus an appliance package | A price reduction, not a rate offer | Contracts October 12 to 18, 2026, close by November 30 | Not stated as a rate condition |
Lennar's contract window ran only through October 18, and the homes shown on that sale page were in Temple, Jarrell, Salado and nearby towns rather than Killeen. It's still worth including because it shows the third way builders are moving homes this season, by cutting the price itself.
Each structure helps a different buyer. A price cut lowers the loan balance for as long as you own the home. A fixed-rate pool locks the payment for 30 years. The Stylecraft ARM gives you the lowest payment of the three for five years, and after that the terms decide what you pay.
What Year Six Looks Like on the 4.49% Loan
Stylecraft's disclosure is clear about how the rate can move once the fixed period ends. The rate adjusts every 12 months. Each adjustment can't move more than 1%, and total increases are capped at 5% over the life of the loan. Applying those caps to the 4.49% starting rate gives this ceiling:
- Years one through five: 4.49%, paid for by Stylecraft.
- Year six: no higher than 5.49%.
- Year seven: no higher than 6.49%.
- Lifetime maximum: 9.49%.
The disclosure also says the new rate will be the market rate at adjustment or the 1% maximum increase, whichever is lower. The rate can also never fall below the loan's margin. That explains the APR gap. Stylecraft says its 6.879% figure assumes the maximum annual rate adjustment. So the APR prices the loan over its full term, and the headline rate covers only the first five years.
For a military family expecting a PCS move before year six, the adjustment years may never arrive. A household planning to stay ten years would spend five of them under the adjustment caps.
Two more conditions matter. The offer requires a 680 minimum credit score and a maximum 50% debt-to-income ratio, and Stylecraft says lower scores or higher ratios lead to higher pricing. It's advertised for FHA and VA loans on a primary residence.
The Monthly Payments Aren't Measured the Same Way
The builders' sample payments look comparable until you read what goes into each one.
Stylecraft's example uses a $320,208 purchase price with an FHA loan and 3.5% down, which comes to a $314,417 loan once the upfront mortgage insurance premium is included. The payment for the initial period is listed at $1,591. That figure leaves out taxes, insurance and monthly mortgage insurance, and the disclosure says the actual payment will be higher.
D.R. Horton's VA example uses a $313,990 sales price, a $320,740 loan with the funding fee financed, and a monthly payment of $2,437. That total includes principal, interest, estimated taxes, mortgage insurance, homeowners insurance and HOA dues. The FHA version of the same example comes to $2,505.
So the $846 gap between those two numbers is mostly a difference in what got counted. To compare them, you need the full housing payment on both, built from the same price and the same loan type.
D.R. Horton's fine print adds that the rate "may require borrower to pay points to obtain the advertised rate," and that rates last only until the pool of funds runs out. According to the Consumer Financial Protection Bureau, one point equals 1% of the loan amount. On a loan around $320,000, every point you're asked to pay adds roughly $3,200 to your cash at closing.
The taxes inside that payment went up this year, too. The City of Killeen adopted a rate of $0.7301 per $100 of taxable value for tax year 2026, up from $0.7014. The City estimates that adds about $68.48 a year, roughly $5.71 a month, on its median-valued homestead. Bell CAD's 2026 tax rate chart also lists Killeen ISD at $0.8622 and Bell County at $0.2995 per $100, before any special districts.
Why Resale Sellers Are Now Paying for Buydowns
Builder financing sets the benchmark that every resale listing in Killeen gets measured against. In August 2026, the Killeen local market area recorded 118 MLS sales, down 3.28% from a year earlier, with 688 active listings and 5.64 months of inventory, according to the Texas Real Estate Research Center. The median sale price was $232,000. Across the wider Killeen-Temple metro, inventory stood at 5.23 months that same month.
Those sales counts come from the MLS, and the center notes that its data leaves out new-home sales negotiated directly between builders and buyers. When a buyer contracts straight with a builder and never goes through the MLS, that sale doesn't appear in the slowdown figures, even though it took one buyer out of the resale pool. Builders also keep adding supply. The City of Killeen issued 60 single-family residential permits in September 2026.
Resale sellers are responding with terms. A Killeen broker told KWTX that rates above 7% have reduced the number of buyers, and that sellers "have to be open to negotiating buyer's expenses, closing costs, buydowns, point buydowns, even solar panels." In one recent closing, the seller paid off $80,000 worth of solar panels to stay competitive.
Pricing is under pressure too. Another local broker told the Killeen Daily Herald that 2,148 homes sold locally in 2026 through August, compared with 2,355 in the same stretch of 2025. He added that a new listing usually goes up against "seven or eight like homes" for sale at the same time. He described a home priced at $280,000 when comparable homes sit between $250,000 and $260,000 as losing its audience.
The 4% Ceiling on a VA Purchase
A resale seller who offers a VA buyer a temporary buydown runs into a federal limit. The VA says a temporary buydown paid by the builder or seller counts as a seller concession, and seller concessions are capped at 4% of the property's reasonable value. On a home that appraises at $299,900, that ceiling is about $12,000, and it covers every concession that counts toward it, the buydown included. On the builder side, Stylecraft's own disclosure says its incentive may not exceed seller concession limits and that total interested-party contributions are limited.
Under the VA's temporary buydown guidance, buydown funds sit in a separate escrow account, and the payment can rise by no more than one percentage point per year. The lender also has to qualify the buyer on the full payment due after the buydown ends, so a reduced first-year payment doesn't increase how much house a VA buyer qualifies for. For conventional loans, Fannie Mae's Selling Guide limits temporary buydowns to a 3-point initial reduction over no more than three years, and underwriting is based on the note rate.
In practice, a resale seller's buydown is usually temporary and sized to fit under the cap. Stylecraft's rate holds for five years and D.R. Horton's for thirty, and both builders require you to use their affiliated lender to get the rate. Neither builder requires that lender to buy the house itself, only to get the promotion.
This is general information, not legal, tax or financial advice. Please confirm loan terms, concession limits and your own eligibility with your lender and the appropriate professionals.
Quick Answers
Will these builder offers still be available when I'm ready? Each one has a deadline. Stylecraft's rate requires closing by November 30, 2026, and its terms date from September 29, 2026. D.R. Horton's requires a contract on or after October 1, 2026 and closing by January 29, 2027, and it lasts only while its pool of funds holds out. Both builders say their offers can change without notice.
Can I use my own lender and still get the rate? Not for these promotions. Both builders say you can finance through any lender you like, but only their affiliated lender will give you the advertised rate.
Is August the latest market data? The Texas Real Estate Research Center releases data for areas outside Houston on or near the 20th day after the month ends. September figures should be out around October 20, so check the center's Killeen page for the newest month.
If you're weighing a builder's rate offer against a resale home whose seller will fund a buydown, I'll build both full monthly payments on the same terms so you're comparing like with like. If you're selling in Killeen this fall, let's figure out what your home's price and concession package need to look like next to the builder down the road. Reach out to Christie Minalga to get your free home valuation and a concession plan built for today's buyers.
