Fixed Rate Mortgages
10,15,20,25,30,40 & 50 year fixed.
Pros:
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 downCons:
Higher interest rate Higher mortgage payments Rate does not drop if interest rates improveAdjustable Rate Mortages (ARM)
10/1, 7/1, 5/1, 3/1, 1/1, 6 month, 1 month ARM's & Option ARM's
Pros:
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 Cons:
More risk Payments may change over time Potential for high payments if rates go up First Time Home Buyers
Pros:
Lower down payment Easier to qualify Sometimes you may get lower rateCons:
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, No Document & Low Document Progams
Pros:
Don't need to verify income Faster approval Less paper workCons:
Higher rates Higher down paymentNo Point & No Fee Programs
Pros:
No closing costs Less money required to closeCons:
Higher rates Higher paymentsLess Then Perfect Credit Programs
Pros:
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 paymentCons:
Higher rates Terms may not be as favorable Harder to get long term fixed loans Loans may have prepayment penalties
