Mortgage Loan Programs
Arbor Mortgage Group offers numerous home mortgage products. Keep in mind, the differences between each type is based on your specific needs. A mortgage professional can help you navigate the choices you have and perhaps introduce a few you may not have considered. Because you are ‘buying’ a mortgage, getting the best deal at the right price can mean thousands of dollars saved over the course of the mortgage.
Here is some important, albeit general, information about a variety of loans available. An Arbor Mortgage Group professional can help you narrow down your choices.
Fixed Rate Mortgage
This is the single most popular loan choice for several reasons. The interest rate will remain the same throughout the life of the loan. The payment will remain the same as well. The loan balance will be reduced each month until the balance reaches zero. The most common length is 30 years, in part because of the manageable payment fits nicely in most budgeting scenarios.
Adjustable Rate Mortgages
This mortgage, often referred to as an ARM, can be one of the most difficult to understand. The loan usually begins at a fixed rate, often enticingly low, and remains that way for five years (in some loans, the terms can be three, seven, and even ten years). After the fixed term expires, the rate will adjust depending on which index your contract is tied to and often with caps in place. This is the ideal mortgage for a buyer looking to remain in the house for a short period. These loans are sometimes written with conversion potential so it can become fixed with a fee and very little paperwork.