Choosing the Right Mortgage

Choosing the Right Mortgage

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

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

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

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. Payments can change

Home Equity Fixed Loan
	Fixed payments Interest may be tax deductible		Higher interest rates than on 1^st mortgages

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!