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FHA LOAN

FHA LOAN

An FHA (Federal Housing Administration) loan is a type of government-backed mortgage insured by the FHA. Designed to help low-to-moderate income borrowers obtain financing, FHA loans offer more lenient credit requirements and lower down payment requirements, making them an attractive option for first-time homebuyers. One of the primary benefits of an FHA loan is the […]

VA HOME LOAN

VA HOME LOAN

A VA home loan is a mortgage loan guaranteed by the Department of Veterans Affairs (VA) for eligible veterans, active-duty military personnel, and surviving spouses. The VA loan program was created to help military members achieve homeownership with more favorable terms and lower costs. One of the key benefits of VA loans is the ability […]

INTEREST ONLY MORTGAGE

INTEREST ONLY MORTGAGES

A mortgage is called “Interest Only” when its monthly payment does not include the repayment of the principal for a certain period of time. Interest Only MORTGAGES are offered on fixed-rate or adjustable-rate mortgages as well as on option ARMs. At the end of the interest-only period, the loan becomes fully amortized, thus resulting in […]

COMPONENTS OF ADJUSTABLE RATE MORTGAGES

COMPONENTS OF ADJUSTABLE RATE MORTGAGES

To understand an ARM, (ADJUSTABLE RATE mortgage) you must have a working knowledge of its components. Those components are: Index: A financial indicator that rises and falls, based primarily on economic fluctuations. It is usually an indicator and is therefore the basis of all future interest adjustments on the loan. Mortgage lenders currently use a variety […]

COMMONLY USED INDEXES FOR AN ARM MORTGAGE

COMMONLY USED INDEXES FOR AN ARM MORTGAGE.

6-Month CD Rate This index is used in ARM mortgages and is the weekly average of secondary market interest rates on 6-month negotiable Certificates of Deposit. The interest rate on 6-month CD-indexed ARM loans is usually adjusted every 6 months. Index changes on a weekly basis and can be volatile. 1-year T-Bill This index is […]

BALLOON MORTGAGES

BALLOON MORTGAGES

A balloon mortgage has an interest rate that is fixed for an initial amount of time. At the end of the term, the remaining principal balance is due. At this time, the borrower has a choice to either refinance or pay off the remaining balance. There are no penalties to paying off a balloon mortgage […]