Home Mortgage Loan Programs
Which Home Loan is right for me? Well it really depends on many variables. Lets start with these simple questions you should be asking yourself before you speak with a Home Loan Mortgage Expert
Years you plan to stay in the home and recommended programs
- 1-3 years 3/1 ARM, 1 year ARM or 6 month ARM
- 3-5 years 5/1 ARM
- 5-7 years 7/1 ARM
- 7-10 years 10/1 ARM, 30 year fixed or 15 year fixed
- 10+ years 30 year fixed or 15 year fixed
In addition to our standard loan programs
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you may benefit by obtaining one of our many special programs:
- Purchase your home with no down payment using Private Mortgage Insurance (PMI) or Lender-paid Mortgage Insurance (MI).
- Piggyback loans: 80-10-10 or 80-15-5. Avoid PMI payments by using Lender-paid MI.
- Debt consolidation programs.
- Home Improvement loans.
You may qualify even if you've been turned down before!
Fixed Rate Mortgages
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- 30 year fixed
- 15 year fixed
- Monthly payments are fixed over the life of the loan
- Interest rate does not change
- Protected if rates go up
- Can refinance if rates go down
- A little Higher interest rate
- Higher mortgage payments
- Rate does not drop if interest rates improve
Adjustable Rate Mortgages (ARM)
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- 10/1 ARM
- 7/1 ARM
- 5/1 ARM
- 3/1 ARM
- 1 year ARM
- 6 month ARM
- 1 month ARM
- Lower initial monthly payment
- Rates and payments may go down if rates improve
- May qualify for higher loan amounts
- 30 year term, no balloon payment
- More risk
- Payments may change over time
- Potential for higher payments if rates increase
Balloon Mortgages
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- 7 year
- 5 year
- Lower initial monthly payment
- Lower payment for a predetermined period of time
- Many balloon mortgages offer the option to convert to a new loan after the initial term
- Risk of rates being higher at the end of the initial fixed period
- Risk of foreclosure if you cannot make balloon payment, refinance, or exercise the conversion option
- Balloon payment requires you to sell or refinance after the term, as opposed to a 7/1 or 5/1 program with a 30 year term
First Time Buyer Programs Lower down payment
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- Easier to qualify
- Lower rates may be available
- May be subject to income and property value limitations
- Some government subsidized programs may generate a recapture tax if you sell the house too soon
- Education courses may be required to qualify for these loans
Stated Income Programs Don't need to verify income
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- Faster approval
- Higher rates
- Higher down payment
- Good for borrowers who may not qualify with a full income documentation program
Interest Only Programs You have several payment options
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- Higher rates
- Lower monthly payments
- Qualify for a higher loan amount
- Qualify at the interest only payment
- Option to pay the full normal payment
- Interest only payments for up to ten years
- Payment will be higher for the remaining term
- Principal loan balance will not decrease during the interest only payment period
No point, No fee Programs No out-of-pocket loan costs at closing
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- Higher rates
- Higher payments
- Less money required to close
- Closing costs are paid from the lender rebate
- Refinance without increasing your loan amount
- Some require a prepayment penalty for the first one to five years
- Some lenders may have a short payoff penalty which is usually charged to the loan broker, but may be passed on to you
Imperfect Credit Programs Potential for reestablishing credit
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If you pay your mortgage on time this can be used for debt consolidation, you may be able to reduce your monthly debt payment
- Higher rates
- Terms may not be as favorable
- Harder to get long-term fixed loans
- Loans may have prepayment penalties
Home Equity Line of Credit You only borrow what you need
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- Flexible access to funds
- Interest may be tax deductible
- May be free of closing costs
- Pay interest only on what you borrow
- Payments can change
- Harder to refinance your first mortgage
- Can be used for debt consolidation and lower payments
- A good source for an emergency fund, if set up in advance
- Rates are usually lower than consumer loan or credit card rates
- Rates can change. The maximum interest rate can be relatively high
Home Equity Fixed Loan Fixed payments
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- Interest may be tax deductible
- Get cash out for any purpose
- Harder to refinance your first mortgage
- Higher interest rates compared to first mortgage
- Interest is paid on the entire loan amount, compared to an equity line of credit
