| Loan Program | Advantages | Disadvantages |
Fixed Rate Mortgages
- 30 year fixed
- 15 year fixed
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- 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
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- Higher interest rate
- Higher mortgage payments
- Rate does not drop if interest rates improve
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| 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
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- 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
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- More risk
- Payments may change over time
- Potential for higher payments if rates increase
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| Loan Program | Advantages | Disadvantages |
| Balloon Mortgages
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- 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
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- 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
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| Loan Program | Advantages | Disadvantages |
| First Time Buyer Programs |
- Lower down payment
- Easier to qualify
- Lower rates may be available
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- 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
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| 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
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- Higher rates
- Principal loan balance will not decrease during the interest only payment period
- Payment will be higher for the remaining term
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| 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
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- 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
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| Loan Program | Advantages | Disadvantages |
| Home Equity Line of Credit |
- You only borrow what you need
- Pay interest only on what you borrow
- Flexible access to funds
- Interest may be tax deductible
- May be free of closing costs
- A good source for an emergency fund, if set up in advance
- Can be used for debt consolidation and lower payments
- Rates are usually lower than consumer loan or credit card rates
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- Rates can change. The maximum interest rate can be relatively high
- Payments can change
- Harder to refinance your first mortgage
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| Loan Program | Advantages | Disadvantages |
| Home Equity Fixed Loan |
- Fixed payments
- Interest may be tax deductible
- Get cash out for any purpose
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- Higher interest rates compared to first mortgage
- Harder to refinance your first mortgage
- Interest is paid on the entire loan amount, compared to an equity line of credit
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| Loan Program | Advantages | Disadvantages |
| FHA Loans |
- Financing up to 96.5% of the purchase price of your home
- No limit on income to qualify
- Up to 6% seller contributions allowed
- Gift funds from relatives acceptable for down payment and closing costs
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- Limited list of approved condominiums
- Mortgage insurance remains for the life of the loan.
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| Loan Program | Advantages | Disadvantages |
| Foreign National Loans |
- Competitive Rates
Financing up to 60% of the purchase price of your home up to $1,000,000.00
- Higher loan amounts available with a larger down payment
- Program Requires:
- Liquid reserves in the United States
- Accountants letter or tax returns verifying income
- (2) Credit Reference Letters from home country
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| Loan Program | Advantages | Disadvantages |
| Reverse Mortgages |
- No income or credit qualification
- No repayment is made until the home is sold or the owner permanently moves out or passes away
- You never owe more than the current market value of the home at the time the loan becomes due
- You can use proceeds in any way you see fit ……monthly expenses, home repairs, healthcare, education for grandkids, travel, ANYTHING!
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- Borrower must be 62 years old to qualify
- The property must be a primary residence
- Higher closing costs than conventional financing
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