| Loan Program | 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 Program | Advantages | Disadvantages |
|---|
Adjustable Rate Mortgages (ARM) - 10/1 ARM
- 7/1 ARM
- 5/1 ARM
- 3/1 ARM
- 1 year ARM
- 6 month ARM
- 1 month ARM
| - Lower initial monthly payment
- Rates and payments may go down if rates improve
- May qualify for higher loan amounts
- 30 year term, no balloon payment
| - More risk
- Payments may change over time
- Potential for higher payments if rates increase
|
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| Loan Program | Advantages | Disadvantages |
|---|
FHA Loans - 30 year fixed
- 3 year Arm
- 1 Year Arm
| - More forgiving credit critera
- Low interest rate for first time home buyers or borrowers with 0 beacon score
- Low down payment
- Down can be gifted or come from a down payment assistance program
| - slightly higher rates than Conventional
- Mortgage Insurance is required
- May be subject to income and property value limitations
|
|
| Loan Program | Advantages | Disadvantages |
|---|
| VA Mortgage | - No down Payment
- No PMI
- Lower rates for a 100% mortgage
| - Subject to loan amount limitations
- Must have VA eligibility
- VA Funding fee financed in loan
|
|
| Loan Program | Advantages | Disadvantages |
|---|
| Stated Income Programs | - Don't need to verify income
- Faster approval
- Good for borrowers who may not qualify with a full income documentation program
| - Higher rates
- Higher down payment
|
|
| Loan Program | Advantages | Disadvantages |
|---|
| Interest Only Programs | - You have several payment options
- Lower monthly payments
- Qualify for a higher loan amount
- Qualify at the interest only payment
- Option to pay the full normal payment
- Interest only payments for up to ten years
| - Higher rates
- Principal loan balance will not decrease during the interest only payment period
- Payment will be higher for the remaining term
|
|
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| Loan Program | 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 Program | 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
- May be free of closing costs
- A good source for an emergency fund, if set up in advance
- Can be used for debt consolidation and lower payments
- Rates are usually lower than consumer loan or credit card rates
| - Rates can change. The maximum interest rate can be relatively high
- Payments can change
- Harder to refinance your first mortgage
|
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In addition to our standard loan programs, you may benefit by obtaining one of our many special programs:
- Purchase your home with no down payment.
- Piggyback loans: 80-10-10 or 80-15-5. Avoid PMI payments.
- Debt consolidation programs.
- Pay Option Arm Loans
- You may qualify even if you've been turned down before!
