Loan Programs
There are many loan programs to fit almost any need. Please call and ask which loan program best fits your situation.
Recommended Programs
Use the information below to choose the best program for your need.
Years you plan to
stay in the house: |
Recommended Program(s): |
| 1 - 3 |
3/1 ARM, 1 year ARM or 6 month ARM, 5 year interest only |
| 3 - 5 |
5/1 ARM, 5 year interest only, 40 year fixed |
| 5 - 7 |
7/1 ARM, 10 year interest only, 40 year fixed |
| 7 - 10 |
10/1 ARM, 40 or 30 or 15 year fixed |
| 10+ |
40,30 or 15 year fixed |
- 15- 30 or 40-Year Fixed Rate
Payment and rate stay the same from start to finish plus tax & insurance - 5 and 7 Year Balloons
Lower start rate. Some of the balloon programs may
be converted to an adjustable rate or a fixed rate after the 5 or 7
years, with very low fee and attractive rate - Adjustable Rate Mortgage (ARM)
Lowest start rate Adjusts either every 6 months or
every 12 months depending on program and grade and is based on the
economy 6% ceiling for prime and 7% ceiling for sub-prime. - 5/1 and 7/1 Fixed Rate
Rate is fixed for the first 5 or 7 years, then shifts to an adjustable rate mortgage (ARM). - 2/28 and 3/27 ARM
An ARM program that is fixed for the first 2 or 3
years, then shifts into a 6 month adjustable rate mortgage. It is a
sub-prime program giving you a rate lower than the sub-prime 30-year
fixed, and if you have had credit problems, it allows a window of time
for credit rebuilding and seasoning. You will then want to refinance
this loan.
Which Program is best for me?
Here are a few things to keep in mind when selecting a loan program.
| 15- 30 or 40-Year Fixed Rate |
| Advantages: |
|
Disadvantages: |
Maximum interest deduction for taxes, sometimes
easier to qualify, stable predictable payments, high loan to value,
lower down payment, possible secondary financing if needed. |
|
Pay more interest over the life of the loan, higher
starting interest rate, Lower debt ratio (Larger Income to qualify)
Higher monthly payment. |
| 5 and 7 Year Balloons |
| Advantages: |
|
Disadvantages: |
Lower starting interest rates help qualify for higher loan amounts. If you plan to sell within 2-3 years. If you expect your income to increase |
|
Periodic payment and rate increases, builds equity Slower payment increases may affect budget. |
| Adjustable Rate Mortgage (ARM) |
| Advantages: |
|
Disadvantages: |
Lower starting rate than 30 year fixed
great for refinancing from a higher rate use when you plan a move in
5-7 years Some are convertible to 30-yr fixed or a treasury ARM, low
fees, good rates. |
|
Periodic payment and rate increases, builds equity Slower payment increases may affect budget. |
| 5/1 and 7/1 Fixed Rate |
| Advantages: |
|
Disadvantages: |
No Rate Change in First Years Lower Starting Fixed Rates If You Plan to
Sell Within 3 - 7 Years Allows Budget Planning Can Give You Time to
Repair Credit |
|
Rate Increases after Fixed Term Possible 6% Lifetime Rate Increase
Builds Equity Slower Loses Advantage After First Fixed Period Fixed
rates change to adjustable rate |
|
