Mortgage Loan In Alamo

Alamo Mortgage Loan

Types of Mortgage Loans
There are several different types of mortgage financing. It is important to work with a responsible Mortgage Professional who can help you choose the type of Financing that will best meet your needs.

30 Year Fixed Rate: 30 year fixed mortgage is a type of mortgage loan that is repaid by the borrower making 360 equal monthly payments over a period of 30 years. Since the borrower's payments are 'fixed', the borrower can expect to make the same monthly payment for the entire term of the loan. A 30 year mortgage loan is the most widely accepted program used to finance a residential purchase, and is available for conventional, jumbo, FHA and VA loans.

15 Year Fixed Rate: 15 year fixed mortgage is a type of mortgage loan that is repaid by the borrower making 180 equal monthly payments over a period of 15 years. Since the borrower's payments are 'fixed', the borrower can expect to make the same monthly payment for the entire term of the loan.  A 15 year fixed is also available for conventional, jumbo, FHA and VA loans.

1, 3, 5, 7, 10 Year Adjustable Rate: An Adjustable Rate Mortgage (ARM) is a mortgage loan that is most widely known for its low starting interest rate (when compared to the 30 & 15 year mortgage loans). Once this introductory period is over, the interest rate is adjusted periodically based on a pre-selected index. The most common index program is the One Year Adjustable Mortgage (one Year ARM). The interest rate on the one year ARM is adjusted once each Year, for 30 years. APR's on variable rate loans are subject to increase but may decrease from year-to-year, the borrower should be prepared to handle an increase in his/her monthly payment (should the index rate increase).

Jumbo: A jumbo mortgage is a mortgage loan which is larger than the limits set by Fannie Mae and Freddie Mac ($322,701 and above). Since these two agencies will not purchase these types of loans, they usually carry a higher interest rate.

FHA: An FHA mortgage loan is insured by the Federal Housing Administration. Although mortgage lenders provide the mortgage funds, the FHA sets underwriting standards for approving applicants. FHA limits the types of loan programs it insures, but it will insure the more popular 30 year fixed, 15 year fixed and one year adjustable loan programs. However, borrowers are limited to the amount that they can borrow using an FHA-insured mortgage.

VA: A VA mortgage loan is guaranteed by the Department of Veterans Affairs (DVA). One of the biggest advantages of using a VA loan is that the borrower can finance the purchase of a property with no-money down. However, VA loans are restricted to individuals qualified by military service. The DVA will guarantee the more popular 30 year fixed, 15 year fixed loan programs.

5/25, 7/23 Balloon: A balloon mortgage loan is a type of mortgage loan that has a short term (typically 5 or 7 years), but the monthly payment is computed using a 30 year term. When a borrower uses a balloon loan, he/she will make the monthly payment for the scheduled loan term (5 or 7 years). When this loan term is over, the borrower is required to pay off the remaining balance in one lump-sum payment. 

Be sure to consult a mortgage broker or lender to find out exactly what options are available to you and would be best for your situation.

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