Loan Programs
Which Loan is Right for You?
In the past every home owner got the same loan: a 30 year fixed mortgage. Today there are many different loan programs and choosing the right one could save you hundreds of dollars on your monthly payments.
How Long Do You Plan
On Living In The House?
Not Very Long (1-3 Years)
A few years (3-5 Years)
At least 5 years (5-7 years)
Around 10 years ( 7-10 years)
A long time (10 plus years)
We Recommend
3/1 ARM, 1 year ARM or 6 month ARM
5/1 ARM
7/1 ARM
10/1 ARM, 30 yr fixed or 15 yr fixed
30 year fixed or 15 year fixed
|
Loan Programs
|
Advantages
|
Disadvantages |
30 year Fixed
15 year Fixed |
Monthly payments won’t change
Interest rate Fixed
Protected if rates go up
Can refinance if rates go down |
Higher interest rate
Higher mortgage payments
Rate does not drop if interest rates improve |
|
|
|
| Adjustable Rate Mortgages (ARMS) |
Lower initial monthly payment
Lower payment over a shorter period of time
Rates and payments may go down if rates improve
May qualify for higher loan amounts |
More risk
Payments may change over time
Potential for high payments if rates go up |
|
|
|
| Balloon Mortgages |
Lower initial monthly payment
Lower payment over a shorter 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 or if you cannot refinance or if you cannot exercise the conversion option |
|
|
|
| First Time Buyer Programs |
Lower down payment
Easier to qualify
Sometimes you may get lower rate |
May be subject to income and property value limitations
Some programs which have government subsidies may have a recapture tax if you sell the house too early. |
|
|
|
| Stated Income Programs |
Don’t need to verify income
Faster approval |
Higher rates
Higher down payment |
|
|
|
| No point, No fee Programs |
No closing costs
Less money required to close |
Higher rates
Higher payments |
|
|
|
| Imperfect Credit Programs |
Potential for reestablishing credit if you pay your mortgage on time.
When 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
Pay interest only on what you borrow
Flexible access to funds
Interest may be tax deductible |
Rates can change. The maximum interest rate is normally high.
Payments can change
Harder to refinance your first mortgage |
|
|
|
| Home Equity Fixed Loan |
Fixed payments
Interest may be tax deductible |
Higher interest rates than on 1st mortgages
Harder to refinance your first mortgage |
|
|
|
In Addition to these standard loan programs we offer a large number of specialized loans to fit your needs:
· Purchase a home with Zero Money Down
· Piggyback loans 80-10-10 or 80-15-5. No PMI payments even with 5% or 10% down.
· Debt consolidation programs
· Home Improvement loans
· Qualify with low fico score or even if you’ve been turned down before!
