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Which Loan Is Best For Me?

Years you plan to stay in the home Recommended program
1-3 years
3/1 ARM, 1 year ARM or 6 month ARM
3-5 years
5/1 ARM
5-7 years
7/1 ARM
7-10 years
10/1 ARM, 30 year fixed or 15 year fixed
10+ years
30 year fixed or 15 year fixed

Loan Program Advantages Disadvantages
Fixed Rate Mortgages
  • 30 year fixed
  • 15 year fixed
  • 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 down
  • Higher interest rate
  • Higher mortgage payments
  • Rate does not drop if interest rates improve
Loan Program Advantages Disadvantages
Adjustable Rate Mortgages (ARM)
  • 10/1 ARM
  • 7/1 ARM
  • 5/1 ARM
  • 3/1 ARM
  • 1 year ARM
  • 6 month ARM
  • 1 month ARM
  • Lower initial monthly payment
  • Rates and payments may go down if rates improve
  • May qualify for higher loan amounts
  • 30 year term, no balloon payment
  • More risk
  • Payments may change over time
  • Potential for higher payments if rates increase
Loan Program Advantages Disadvantages
Balloon Mortgages
  • 7 year
  • 5 year
  • Lower initial monthly payment
  • Lower payment for a predetermined period of time
  • Many balloon mortgages offer the option to convert to a new loan after the initial term
  • Risk of rates being higher at the end of the initial fixed period
  • Risk of foreclosure if you cannot make balloon payment, refinance, or exercise the conversion option
  • Balloon payment requires you to sell or refinance after the term, as opposed to a 7/1 or 5/1 program with a 30 year term
Loan Program Advantages Disadvantages
First Time Buyer Programs
  • Lower down payment
  • Easier to qualify
  • Lower rates may be available
  • May be subject to income and property value limitations
  • Some government subsidized programs may generate a recapture tax if you sell the house too soon
  • Education courses may be required to qualify for these loans
Loan Program Advantages Disadvantages
Stated Income Programs
  • Don't need to verify income
  • Faster approval
  • Good for borrowers who may not qualify with a full income documentation program
  • Higher rates
  • Higher down payment
Loan Program Advantages Disadvantages
Interest Only Programs
  • You have several payment options
  • Lower monthly payments
  • Qualify for a higher loan amount
  • Qualify at the interest only payment
  • Option to pay the full normal payment
  • Interest only payments for up to ten years
  • Higher rates
  • Principal loan balance will not decrease during the interest only payment period
  • Payment will be higher for the remaining term
Loan Program Advantages Disadvantages
No point, No fee Programs
  • No out-of-pocket loan costs at closing
  • Closing costs are paid from the lender rebate
  • Less money required to close
  • Refinance without increasing your loan amount
  • Higher rates
  • Higher payments
  • Some lenders may have a short payoff penalty which is usually charged to the loan broker, but may be passed on to you
  • Some require a prepayment penalty for the first one to five years
Loan Program Advantages Disadvantages
Imperfect Credit Programs
  • 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 payment
  • Higher rates
  • Terms may not be as favorable
  • Harder to get long-term fixed loans
  • Loans may have prepayment penalties
Apply Online today to be pre-approved for the loan you want.
Taking P.R.I.D.E. in what we offer our clients; Professionalism Respect Integrity Dedication and Experience



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