Loan Programs:

Traditional Loans

30 Year Fixed  Rate:  This is the loan everyone tells you to get.  You believe it's the "smartest" loan because it usually offers the lowest monthly payments.  Most families, and especially young families, have utilized this loan because you can purchase the MOST house for the smallest monthly payment.  A loan for $100,000 will cost $632.00 per month plus taxes and insurance with the interest rate at 6.5%.  The total interest payments over the life of the loan is $ 127,542.00

20 Year Fixed Rate:  This loan has a lower term of only 20 years.  Surprisingly, there is only about 1/8th point of interst reduction to take this loan over the 30 year program.   A loan for $ 100,000 will cost $738.00 per month plus taxes and insurance with the interest rate at 6.375%.   The total interest payments over the life of the loan is $ 77,176.00

15 Year Fixed Rate:  This is the loan you might take out when you get a promotion or have an increase in monthly income.  Your interest rate is lower than the 30 year fixed program, but you pay higher monthly payments.  The reward is that your home is paid off in only 15 years and the overall interest cost of your home has been dramatically reduced.  A loan for $100,000 will cost $837.00 per month plus taxes and insurance with the interest rate at 5.875%.   The total interest payments over the life of the loan is $ 50,681.00

10 Year Fixed Rate: This is an aggressive loan program that is also fixed for the entire term.   The rate on this program is usually only about 1/8th % lower than the 15 year program.  A loan for $100,000. will cost $1098.00 per month plus taxes and insurance with the interest rate at 5.75%.   The total interest payments over the life of the loan is $ 31,723.00

7/23 Balloon:  This is one of my most popular loan products.  The interest rate has been running just about one full point of interest lower than the 30 year fixed program, but it still has an amortization term of 30 years, yielding a monthly payment lower yet than the traditional 30 year fixed program.  A loan for $100,00 will cost $536.00 per month plus taxes and insurance with the interst rate at 5% for the first 7 years.  This loan can be extended once for the remaining 23 years for a one time fee of $250.00 directly with the Lender if you meet certain criteria (ask about Lender guidelines).

7/1 ARM:   This loan is fixed for the first 7 years, then adjusts every 12 months for the remaining 23 years, or until the loan is paid in full (ask about Lender guidelines).   The rate on this loan fluctuates, but at the time of this writing, this loan has been running about .5% higher than the 7/23 Balloon Loan.  A loan for $100,000 will cost $567.00 per month plus taxes and insurance with the interest rate at 5.5% for the first 7 years.

NOTE:  I recently did a comparison for a customer with a loan amount of $150,000.00  He was concerned that the 7/23 Balloon loan would renew at a rate that might be at a "high", or higher than he would like.  His feelings were that the 7/1 ARM was better because it adjusts every year and "cost averages" the interst rate for the remaining term and the "low years" would balance out the "higher years".  At the time of this writing, the 7/23 Balloon was a $6,900 savings over the 7/1 ARM for the first 7 years.   The real advances can be made on a loan in the early years, therefore a lower interest rate in the early stages of a loan far outweigh a lower interest rate in the latter years. 

If you are concerned about the renewal interest rate with this loan product, please take a look at the rate history for the last 23 years as published by the Mortgage Brokers Association of America. 23 year mortgage history 

10/1 ARM:  This product is fixed for 10 years, then adjusts every year for the remaining 20 years.   It is also based on a 30 year amortization.  Recent rates have been running about the same as the 30 year fixed product and I do not see any advantage with this loan product at current rate matrixes.

5/1 ARM:   This product is fixed for 5 years, then adjusts every year for the remaining 25 years.  Based on a 30 year amortization. 

3/1 ARM:   This product is fixed for 3 years, then adjusts evey year for the remaining 27 years.  Based on a 30 year amortization.

1/1 ARM:   This product is fixed for 1 year, then adjusts evey year for the remaining 29 years.  Based on a 30 year amortization.

These are rates for these different Loan  products and are used for demonstration purposes only.  Rates change daily and should be quoted by your Loan Officer.  This is meant to demonstrate the differences in rates for these products.   Please get a personal rate quote with APR from your Loan Officer.

PRODUCT              RATE                          APR                             Monthly Payment*                                

30 Yr Fixed       6.125%            6.25% APR                   $  607.61

20 Yr Fixed       6.0 %                6.127% APR                    $ 716.43

15 Yr Fixed       5.5%                5.623% APR                    $ 817.08

10 Yr Fixed      5.375%             5.497% APR                    $ 1079.08

10/1 ARM        6.0%                  6.127% APR                    $ 599.55

7/1 ARM         5.25%                   5.371% APR                    $ 552.20

5/1 ARM         4.75%                   4.68% APR                      $ 521.65

3/1 ARM         4.25%                  4.36% APR                      $ 491.94

1/1 ARM         3.125%                 3.23%APR                       $ 428.38

* Monthly payment is based on a loan amount of $100,000.

Contact me for a loan analysis of your personal financing opportunities.  We can "work the numbers" and make an intelligent loan choice for you and your family.