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One, Three, Five, Seven, Ten Year Adjustable Rate Loan Programs An Adjustable Rate Mortgage (ARM) is a mortgage that starts out at a fixed interest rate for a set amount of time, then adjusts according to the then prevailing interest rate on a pre-determined schedule for the remainder of the loan. Be prepared to handle any increases in your monthly payment as time goes by.
Jumbo Loan Programs A jumbo mortgage has an amount larger than the limits set by the two largest governmental providers of home loans, Fannie Mae and Freddie Mac. Jumbo loans usually have a higher interest rate because these two agencies will not purchase these types of loans.
FHA Loan Programs FHA loans are insured by the Federal Housing Administration (a division of HUD), setting underwriting standards for approving applicants. These loans have set borrowing limits but tend to be easier for borrowers to qualify for a mortgage loan with low down payment requirements and a higher monthly debt allowance.
VA Loan Programs Through the Department of Veterans Affairs VA loans are guaranteed by the Department of Veterans Affairs, allowing those who are qualified by military service to finance with no money down.
Refinancing a current mortgage
Refinancing a current mortgage means you are taking out a new mortgage on your home. It is typically at a lower interest rate or when the terms of the loan, such as with an adjustable rate mortgage, are coming up. Before refinancing, it’s important to find out whether you’ll have to pay a penalty on your existing mortgage if you pay it off early.
Second Mortgage
Generally, the amount you can borrow is limited by your equity, which is the fair market value of your home minus the unpaid balance of your mortgage. Some home equity loans also give you tax breaks on interest. But your loan is secured by your home, so if you cannot repay, the lender has the right to foreclose on your home, which also goes on your credit report.
Equity lines - Equity lines work like a line of credit. This option is flexible, allowing you to borrow and pay interest on each year’s cost only as it arises. Know that some lines specify a certain minimum be borrowed every time you draw on the line, and others even offer a "credit card" for convenience.
When buying, refinancing, or borrowing against a home, you typically have a variety of options to choose from. Depending on your financial situation and your needs, here are the basics on the mortgage options that you may have.
15-Year Fixed Rate Program A 15-year fixed mortgage is similar to a 30-year fixed except it is paid off in half the time. You can expect to make 180 equal payments monthly over 15 years. Only typical difference between a 30-year fixed and a 15-year fixed is your payments are higher on a 15-year loan.
Types of mortgages:
