Which loan is right for me?
| Years you plan to stay in the house |
Recommended program |
| 1-3 |
3/1 ARM, 1 year ARM or 6 month ARM |
| 3-5 |
5/1 ARM |
| 5-7 |
7/1 ARM |
| 7-10 |
10/1 ARM, 30 year fixed or 15 year fixed |
| 10+ |
30 year fixed or 15 year fixed |
| Loan Programs |
Advantages |
Disadvantages |
| Fixed Rate Mortgages |
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
|
• Higher interest rate
• Higher mortgage payments
• Rate does not drop if interest rates improve
|
| Loan Programs |
Advantages |
Disadvantages |
| Adjustable Rate Mortgages |
10/1 ARM
7/1 ARM
3/1 ARM
1 year ARM
6 month ARM
1 month ARM |
• 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
|
| Loan Programs |
Advantages |
Disadvantages |
| Balloon Mortgages |
7 year
5 year |
• 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
|
| Loan Programs |
Advantages |
Disadvantages |
| 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.
|
| Loan Programs |
Advantages |
Disadvantages |
| Stated Income Programs |
| |
• Don't need to verify income
• Faster approval
|
• Higher rates
• Higher down payment
|
| Loan Programs |
Advantages |
Disadvantages |
| No point, No fee Programs |
| |
• No closing costs
• Less money required to close
|
• Higher rates
• Higher payments
|
| Loan Programs |
Advantages |
Disadvantages |
| 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
|
| Loan Programs |
Advantages |
Disadvantages |
| 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
|
| Loan Programs |
Advantages |
Disadvantages |
| Home Equity Fixed Loan |
| |
• Fixed payments
• Interest may be tax deductible
|
• Higher interest rates than on 1st mortgages
• Harder to refinance your first mortgage
|
Besides our standard loan programs, we also have a large number of unique programs
to serve your needs:
- Purchase a house with 0 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 even if you may have been turned down before!
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