financial section: mortgages

Fixed-Rate Mortgages

Usually we have 30-year, 20-year, and 15-year, fixed-rate loans. These loans usually come with no pre-payment penalty and are an excellent choice when rates are low - like right now!

Advantages: The rate will stay the same for the life of the loan. If you can secure a fixed-rate loan when interest rates are low, you'll be sitting pretty if and when rates go back up.

Disadvantages: Interest rates and total interest paid will be higher than with an adjustable-rate loan, and you have less flexibility in the event that rates go down.

Adjustable-Rate Mortgages

We have 1-year fixed, 3-year fixed, 5-year fixed, and 7-year fixed adjustable mortgages. These loans are usually lower than what you would obtain with a 30-year fixed-rate loan. After the fixed period the loan becomes adjustable, with a rate that reflects the rates available at that time.

Advantages: You may be able to get into a bigger, more expensive home with lower initial monthly payments. If you believe it is likely you will be selling before the end of the fixed-rate period, this could be an excellent way to minimize your monthly housing expenses and improve your cash flow.

Disadvantages: With an adjustable-rate mortgage you will have less stability in terms of interest rates and monthly payments. If your risk-tolerance is low or you plan to stay in the home for a significant period of time, this may not be your best choice.

Interest-Only Mortgage Loans

These loans are fixed for a pre-determined term then become adjustable, and have the lowest monthly payment of most loan programs, as the monthly payment is only paying the interest.

Advantages: Similar to a traditional ARM, you may be able to get into a bigger, more expensive home with lower initial monthly payments. This is a good way to go for the short-term buyer, who will sell or refinance in a short period of time.

Disadvantages: The payments are only servicing the loan interest, and therefore the mortgage will never be paid down with this loan.

Information in this site is believed to be accurate, but should not be relied upon without verification

Foreclosures, Bank Owned & Short Sales Specialists