~ DOES THE FHA 3/1 HYBRID ARM REALLY SAVE THE HOMEOWNER HUNDREDS PER MONTH?
~ DOES THE RATE OR PAYMENT EVER RISE?
~ IF SO BY HOW MUCH?
~ HOW OFTEN? ~ IS IT A SAFE LOAN?
These are questions that my team and I are fielding quite a bit these past few weeks. And not surprisingly because there has been a recent rise in the 30 year fixed rate average from the upper 4s to the upper 5s over this period. Any time the fixed rates increase like this it stimulates a significant influx of interest in the very safe, secure and low rate FHA Hybrid ARM. What specifically is a 3/1 Hybrid Arm?
The FHA 3/1 Hybrid ARM is a government-insured adjustable rate mortgage that stays fixed for the first 3 years and then adjusts every year thereafter.
BENEFITS:
- Lower rate = lower payment = more affordability = more square footage
- Lower payment = peace of mind with FHA insured loan
- 1/1/5 structure protects homeowner from large increases and provides a secure lifetime CAP
- FHA Loan = homeowner can STREAMLINE into a fixed rate loan WITHOUT income qualification (homeowner must maintain mortgage payments and minimum credit standards in order to streamline)
- Streamline = if homeowner wishes to keep their home after 3 - 5 years then they should have equity in order to streamline with NO APPRAISAL (so value becomes a non-issue)
GENERAL INFO:
- Index: One Year Treasury
- Margin: 2%
- 1st change date: Depends on the first payment date. Auto determined
- Floor rate: 5% below note rate or 2%, whichever is greater
- Lifetime CAP: 5% above the note rate
- Today's note rate: Call for lookup!
- Yearly CAP: 1%
In conclusion, adjustables are not for everyone, but for some, particularly many first time buyers this type of instrument is ideal. Remember, this type of loan is insured by the federal government. The fixed rate on these are very often a full 2 points lower than the 30 year fixed rate loan. Finally, know that my team and I close loans of this type to approved borrowers in under a week!
For more on the whole truth about adjustable rate loans and the difference between a FHA Hybrid ARM and the SUB PRIME ARMS of yesteryear please read this blog entry which explains that and more:
http://activerain.com/blogsview/1111241/the-whole-truth-about-adjustable-rate-mortgages
As always, I'm here to help!
To fill out a secure online application please visit:
http://www.saramortgage.com/apply.asp/Hollis/New%20Hampshire
Jamie Woods ~ Senior Loan Officer ~ FHA/VA/USDA Specialist ~ SARA Mortgage & Financial, LLC ~
Cell: (603)-965-8241 Office: (603)-816-0255 email: jamie@saramortgage.com
web: http://www.mortgagemagician.blogspot.com
Licensed by the NH Banking Dept
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