A large part of which loan is right for each buyer is
based on the length of time the individual intends to stay
in the home along with their financial comfort level with
the payment it will require. There is a loan for every
situation and benefits and drawbacks to each program based
on each borrower’s personal situation.
| Years you Plan to Stay in the House |
Recommended Loan Programs |
| 1 - 3 |
3/1 ARM, 1 Yr ARM, or 6 Month ARM |
| 3 - 5 |
5/1 ARM |
| 5 - 7 |
7/1 ARM |
| 7 - 10 |
10/1 ARM, 30 yr FIXED, 15 yr FIXED |
| 10 + |
30 yr FIXED, or 15 yr FIXED |
| Loan Programs |
Advantages |
Disadvantages |
Fixed
Rate Mortgages
30 yr Fixed
15 yr Fixed |
» Payments
fixed over the life of the loan
» Fixed Interest Rates
» Protected if rates go up yet can refinance
if rates go down |
» Higher
interest Rates
» Higher Payments
» Rate does not drop if rates go down |
Adjustable
Rate Mortgages
6 Month ARM
1 yr ARM
3/1 ARM
5/1 ARM
7/1 ARM
10/1 ARM |
» Lower Monthly
Payments over a shorter period of time
» Rates and Payments may go down if rates
improve
» May qualify borrower for higher loan amounts
with lower payment |
» Higher
risk
» Potential for rates and payments to increase
» Payments may increase over time |
| First
Time Home Buyer Programs |
» Easier
to qualify
» Possible lower down payment
» Lower rates Available |
» May be
subject to home value and income limitations
» May be subject to a recapture tax with some
government subsidized programs, if you resell the
home to soon |
| Stated
Income Programs |
» Income
Verification not needed
» Quicker approvals |
» Higher
Rates
» Higher Down Payments |
| Imperfect
Credit Programs |
» Potential
for reestablishing good credit should the borrower
pay their new mortgage on time
» Potential to use in ddebt consolidation
plans to imrove credit and reduce monthly payments
as a whole |
» Higher
Rates
» Harder to get loans
» Loans terms may not be favorable
» Loans may have pre-payment pnalties |
| No point,
No fee Programs |
» No closing
costs
» Requires less money to close |
» Higher
Rates
» Higher Payments
» May have prepayment penalties |
| Balloon
Mortgages |
» Lower initial
monthly payment on a fixed rate for a set period of
time |
» Have to refinance
or pay off short than the amortization period. |
| Home Equity
Line of Credit |
» Borrow
only what you need
» Pay interest only on what you borrow
» Easily accessible funds
» Interest may be tax deductible |
» Paymen
can change
» Rates and maximum payments may go up
» Can make it harder to refinance a first
mortgage |
| Home Equity
Fixed Loan |
» Fixed rates
and payments
» Interest may be tax deductible |
» Higher
Rates
» Can make it harder to refinance your first
mortgage
» Interest charged is based on the entire loan
amount as opposed to only the amount borrowed |
In addition to our standard loan programs, we offer a
number of other products to facilitate a variety of situations
and scenarios, such as:
Piggyback Loans 80-10-10 or 80-15-5. No PMI payments even
with 5-10% down.
If you have a financial problem,
we have a solution. We can qualify you even if you’ve
been turned down before! Call us today, and we will help
you achieve the financial freedom you desire.
