Adjustable Rate Mortgage
Adjustable rate mortgages have an interest rate that is adjusted at certain
intervals based on a specific index during the life of the loan.
Balloon Payment Loan
A fixed rate loan that is amortized over 30 years but becomes due and
payable at the end of a certain term. May be extended or may roll-over
into another type of loan.
Buy-Down Loans are fixed rate loans where the interest rate and the payment
are reduced for a specific period of time by passing the interest up
front to subsidize the lower payment.
Community Home Buyers Program
A fixed rate loan for the first time home buyer with a low down payment
usually 3-5 %, no cash reserve requirements and easier qualifying ratios.
Qualification is subject to borrower meeting income limits and attendance
of a four hour training course on home ownership.
Conventional loans are sometimes more lenient with the appraisal and
condition of the property. When you are buying a “fixer upper” you
may need to use a conventional loan.
FHA loans are insured by the Federal Housing Administration under H.U.D.
They offer a low down payment and are easier to qualify than conventional
Fixed Rate Loan
A fixed rate loan has one interest rate that remains constant throughout
the life of the loan.
Graduated Payment Mortgage
A fixed rate loan that has payments starting lower than a standard fixed
rate loan, which then increases by a predetermined amount each year for
a set number of years.
Mortgage Credit Certificate
A first time home buyer program is subject to purchase price and income
limits to some areas. It is actually a special tax credit and assists
the buyer in qualifying for many loan programs.
Non-Qualifying Loan (assumable)
Non qualifying loans are pre-existing loans which can be assumed by a
buyer from the seller of a property without going through the qualifying
process. The buyer pays the seller for their equity and then starts making
VA loans are guaranteed by the Veterans Administration. A veteran must
have served 180 days of active service. The maximum VA loan is currently
$203,000 with no down payment.