The interest for a fixed rate mortgage remains constant during the life of a loan. This means that the borrower’s principal and interest payment remains fixed over the life of the loan, although variations in the total monthly payment may occur due to adjustments in the tax and insurance escrow payments. Clients who want to be protected from the possibility of rising interest rate typically prefer a fixed rate. Fixed rate products are usually chosen when interest rate are low and are perceived to be rising.

30 Year Fixed: The monthly payments are fixed, amortized over 30 years. Typically chosen by clients who want the security of a fixed rate and with lower monthly payments than a shorter loan term.

20 Year Fixed: The monthly payments are fixed, amortized over 20 years. Typically chosen by clients who want the security of a fixed rate and a shorter loan term. Payments are typically higher than a 30-year term loan, but lower than a 15-year term loan.

15 Year Fixed: The monthly payments are fixed, amortized over 15 years. Typically chosen by clients who want the security of a fixed rate and the discipline of a product that provides the discipline of quick equity build up through higher monthly payments. Typically has the highest monthly payment of all mortgage loans.

Adjustable Rate Mortgages
Interest rates for adjustable rate mortgages (ARM) may be changed at pre-determined adjustment periods, based on movement in the financial market. As market interest rates rise, the rate of an ARM will move correspondingly. ARM products typically have adjustment caps, which limit the amount the interest rate can change during a period. Please contact us for more information about caps.

ARMs are typically chosen when interest rates are high and are perceived to be falling or the fixed time period of 10,7,5 or 3 years matches their time horizon.

For all products listed below, the monthly payments are based on the amount required to pay off interest and principal in 30 years. Please contact us for more information about payment schedules.

10 Year/6 Month Adjustable: Offers an initial fixed rate for a 10-year period and then converts to an adjustable rate for the remaining 20 years. This product typically offers a lower start rate than a 30-year Fixed Rate mortgage.

7 Year/6 Month Adjustable: Offers an initial fixed rate for a 7-year period then converts to a fixed rate for the remaining 23 years. This product typically offers a lower start rate than a 10-Year/6 month adjustable mortgage.

5 Year/6 Month Adjustable: Offers an initial fixed rate for a 5-year period then converts to a fixed rate for the remaining 25 years. This product typically offers a lower start rate than a 7-Year/6 month adjustable mortgage.

3 Year/6 Month Adjustable: Offers an initial fixed rate for a 3-year period then converts to a fixed rate for the remaining 27 years. This product typically offers a lower start rate than a 5-Year/6 month adjustable mortgage.

6 Month Adjustable: Interest rates change every 6 months. This product is typically chosen when interest rates are perceived to be falling. This provides the opportunity to take advantage of declining rates as the interest rates naturally adjusts every 6 months.

Options:

10-Year Interest Only Option:
With a traditional 30-year amortizing loan, each month we bill you for both principal and interest. The 10-year Interest-Only Option changes that so you will pay just interest for the first 10-years. Beginning in the eleventh year, we will bill you monthly for principal and interest. This is a good program if a large part of your income is bonus and/or you want to maximize the tax benefits of a mortgage.

Prepayment Option:
In short, the pre-payment penalty can lower your rate by approximately ¼%. The prepayment penalty term lasts for the first 5-years of the loan. For the first five years, you can prepay no more than 20% of the original loan amount each year. After the first year of the loan, you can sell at anytime without penalty. After 5-years there are no restrictions on how much you can prepay.

Monthly Escrow for Taxes & Insurance:
You may opt to have your property taxes and homeowners insurance for you or you may choose to pay them yourself. If you choose to have us pay your property taxes and insurance, 1/12 of the estimated yearly costs for taxes and insurance will be added to your monthly payments. In addition, a 2-month reserve will be collected at closing