Loan Programs
Which loan is right for me?
| Years you plan to stay in home |
Best program |
1-3
3-5
5-7
7-10
10+ |
3/1 ARM, 1 year ARM or 6 month ARM
5/1 ARM
7/1 ARM
10/1 ARM, 30 year fixed or 15 year fixed
30 year fixed or 15 year fixed
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Program
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Pros
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Cons
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Fixed Rate Mortgages
- 30 Year fixed
- 15 Year fixed
- 10 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
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Adjustable Rate Mortgages
- 10/1 ARM
- 7/1 ARM
- 5/1 ARM
- 3/1 ARM
- 1 Yr ARM
|
- Lower initial monthly payment
- Lower payment over a shorter period 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
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| No point, No fee Programs |
- No closing costs
- Less money required to close
|
- Higher rates
- Higher payments
|
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| Home EquityLine 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, max rates are 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 1st mortgage
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