This Home Buying Guide (part 7) is brought to you by:
Steve Verrier (904) 514-8884
Additional Loan Options and Creative Financing Products
One of the options you must consider when obtaining a mortgage is which program is best suited to your comfort levels and long range goals.
There are many options to choose from which suggest that it is always best to meet with the lender first to get pre-approved BEFORE you go house hunting.
If you would like to schedule your own No-Obligation No-Cost Consultation; please call me directly, click here or email me at the address found on my website also.
While many borrowers choose a fixed rate loan there are several other options to consider:
Hybrid ARM’s: These are Adjustable Rate Mortgage loans. They will usually be offered as a 1 year, 3 year, 5 year, 7 year or 10 year term. This means your rate will adjust after the initial fixed term of 1, 3, 5, 7 or 10 years. These are often used by folks not planning on being in a particular house for a long time period. They can often save money in the initial tears due to the lower rates these products offer compared to a fixed rate loan.
There are also several different indexes lenders will use to calculate the amount of the adjustment, rate caps and margins are also key factors in this adjustment calculation. The Margin is a fixed percentage based on credit risk and the index is a moving quantity based on market performance.
If ARM’s are of interest to you and you would like to learn all of the details you can call me to discuss your options.
Interest Only Loans: These loans offer the flexibility of paying only your interest which results in a lower initial payment, typically for 10 years at which point the loan is recast and full balance is due in the remaining 20 year term. This is a product that requires careful consultation and review. Most often used again by borrowers with shorter term interest in a property.
Non QM Loans: These are for borrowers that fall outside of agency (FNMA, FHLMC, FHA, VA or USDA) guidelines. Some borrowers have experienced credit related issues and may not have sufficiently seasoned them. A more common situation is borrowers (IE. self-employed) that write off much of their effective income to where they do not qualify so an alternate form of income verification is needed. In this category you will find your bank statement loan, no ratio loan, DSCR or no income verification at all. For details on these products, please contact me directly.
Reverse Mortgages or Home Equity Conversion Mortgages (HECM): These are a great product for seniors over 62 years of age. This type of loan allows you to utilize or otherwise tap into a home’s equity and they come with no monthly repayment requirement! The interest gets deferred to the loan balance. It is a great product for those now living on fixed incomes with little spending money left over after making their payments. In a purchase scenario, it allows a buyer to purchase a home for almost half out of pocket (actual percentage of purchase price is pending on the borrowers’ actual age). It is designed to be a persons last mortgage and it does not become due until the last borrower on the loan expires or no longer resides in the house within a 12 mos. period. At that point the borrowers heirs are given a period of 6 mos. to either pay off the loan through a sale or refinance, should they wish to retain the property. These loans are non -recourse though so if the home value is less than the risen balance of the mortgage the lender must allow the short sale and accepts what the home sells for as a payoff.
Non-institutional/Hard Money loans / Private Money loans: These loans are not attractive for cost but they are attractive as possibly the only way to get into a home at the time desired. Most borrowers using this option are determined to correct whatever caused the need to use this option and refinance as quickly as possible.
New products arrive and guidelines get modified all of the time. For the most up-to-date information on programs and products please call me at (904) 514-8884 and we can customize the one to best fit your needs.
You can also contact me through my website at: https://www.thefloridamortgagecenter.com/contact.htm
In our next issue we will cover an important question you should ask your loan officer (if not me) which could save you thousands on your mortgage…
If you would like to get started now, please fill out a Secure Online Application and we will contact you to set up your free consultation and get you into the home of your dreams with the best terms available-regardless of your credit! https://www.thefloridamortgagecenter.com/application
I hope you have enjoyed this step of our home buyer guide. We have many creative loan programs to fit your needs.
Until our next lesson,
P.S. We have more valuable information and resources at: https://www.thefloridamortgagecenter.com