Choose the Loan that's Best for You

If you haven’t met with a lender to get pre-approved for your mortgage, you might want to first investigate your options on your own. While only a financial advisor or lender can meet with you to determine the financial scenario that will work best for you, I hope the following information can steer you in the right direction:
15- or 30- Year Fixed Rate Mortgage
SCENARIO: Do not plan to move or refinance in the short term; expect interest rates to increase during this period.
LOAN SPECS: Interest & principal remain the same for the life of the loan.
10/1 Adjustable Rate Mortgage
SCENARIO: Plan to keep property for more than 10 years; want initial stability or can accept changes later.
LOAN SPECS: May move within 10 years and want options left open; interest and principal remain the same for 10 years. Beginning in the 11th year, interest rate is adjusted and is subject to change every year thereafter. With each adjustment, payment is based on new principal balance and adjusted interest rate.
7/1 Year Adjustable Rate Mortgage
SCENARIO: Plan to keep property for at least 7 years or more; like initial stability of loan; plan to move within 7 years and want options kept open.
LOAN SPECS: Principal and interest remain the same for the first 7 years. Beginning in the 8th year the interest rate is adjusted and is subject to change every year. With each adjustment, payment is based on new principal balance and adjusted interest rate
5/1 Year Adjustable Rate Mortgage
SCENARIO: Plan to keep property for more than 5 years; like initial rate or are willing to accept risk later; plan to move within 5 years but want to keep options open.
LOAN SPECS: Interest and principal remain the same for 5 years. Beginning in the 6th year, interest rate is adjusted and is subject to change every year thereafter. With each adjustment, payment is based on new principal balance and adjusted interest rate.
3/1 Year Adjustable Rate Mortgage
SCENARIO: Plan to keep property for more than 3 years; like initial rate or are willing to accept risk later; plan to move within 3 years but want to keep options open.
LOAN SPECS: Interest and principal remains the same for 3 years. Beginning in the 4th year the interest rate is adjusted and is subject to change every year thereafter. With each adjustment, payment is based on new principal balance and adjusted interest rate.
1 Year Adjustable Rate Mortgage
SCENARIO: Looking for the lowest possible rate and willing to risk yearly rate changes.
LOAN SPECS: Interest rate is adjusted every year for the life of the loan. With each adjustment, payment is based on new principal balance and adjusted interest rate.
Second Mortgages
SCENARIO: Looking to tap equity in existing home; looking to purchase a home with subprime financing; great to avoid mortgage insurance.
LOAN SPECS: 15-year fixed payments on 30-year amortization. After 15th year, balloon payment of remaining principal is due. Possible 10-year, 15-year, and 20-year amortization.
Lines of Credit
SCENARIO: Looking to tap equity in existing home or to purchase a home with subordinate financing; great to avoid mortgage insurance.
LOAN SPECS: Variable rate based on prime. Ability to draw desired amounts based on outstanding balance

If you have questions about moving, building, selecting your first home or moving up to your next home, contact DAVID BRENTON’S TEAM.

When you are serious about moving… put our TEAM to work for you!