I Have Impressive ARMs
Actually, I don't have impressive arms and never have. While we're on the topic of needles, no amount of iron or swimming has ever "moved the needle" in terms of adding circumference to my puny pop guns. But...
RPM is pleased to add its newest jumbo program in the form of a 15/15 ARM. How does a 15-year ARM work? It's essentially a fixed rate, 30-year loan that has only a single adjustment at the 15-year mark.
Meant to cover the borrowing needs of the vast majority --- those who will, on average, hold a loan for 6 to 10 years --- the 15/15 ARM offers a lower rate than a comparable 30-year fixed rate mortgage. On a loan size of $1,500,000, for example, the difference between the two loan types can be up to .625%. At these higher loan amounts, this can easily equate to a savings in the range of $100,000 over the first 15 years.
I'll always be a fan of the 30-year fixed rate loan in the current low rate environment. But in situations where a borrower knows it is highly unlikely the loan will be held to term, our 15/15 ARM offers the next best degree of peace of mind --- better even than a 10/1 ARM. Whereas a 10/1 ARM will begin adjusting after ten years, and continue to do so for each year of the next 20, the 15/15 has only one rate adjustment during the full, 30-year term.
Here are some of the other attributes of this program:
- 80% loan-to-value (LTV) up to $2,000,000. Max purchase price in this case would be $2,500,000, w/ $500K down.
- 1% margin, 6% rate cap, index is the 10-Year CMT.
- Available for primary and secondary residences.
- Six months reserves required, along with 720 FICO.
- Recast option available. Need a fixed rate loan where a future lump sum paydown of the principal balance will reduce the monthly mortgage payment? The 15/15 works!
If you wouldn't sleep easy at night in a 5/1 ARM, or if you would like a lower rate than you're being quoted on a 30-year fixed, give the 15/15 some thought. Same holds true if you must qualify at a lower, yet stable, starting rate than your typical ARM program might provide. If you have questions or need more detail, let me know and I'll be happy to do the heavy lifting!
Mortgage Loan Originator
NMLS: 22343 CalBRE: 01297944
Cell: 415-367-5959 Fax: 415-366-1590
1058 Redwood Highway, Frontage Road, Mill Valley, CA 94941
RPM Mortgage, Inc - BRE# 01818035 – NMLS# 9472 - CA Bureau of Real Estate, Real Estate Corporation License. Equal Housing Lender.