Mortgage Rates
Three factors help to determine rates, the stock market, inflation and the economy. Rates change often, as many as three times in a day so you need a dedicated loan officer who is constantly watching the market. Mortgage rates are at an all time low.
Common Types of Mortgages
Conventional Loan
Conventional loans, also know as fixed-rate-mortgages (FRM), are those that have an interest rate that does not change. Conventional loans have an amortization schedule that corresponds with term length of 10, 15, 20, 30 or 40 years. This type of loan is not guaranteed or insured by the government. Typically, mortgage bankers and savings & loans banks are the institutions that fund conventional loans.
Interest Only Loans
An interest only loan is when the monthly payment is only applied to the monthly interest accrued. Interest only loans are usually amortized over a 30 year period with a fixed interest rate for the first 2 years. At the start of your third year, the interest rate often becomes adjustable to whatever the current indexed rate is and can change from month to month.
Reverse Mortgage
A reverse mortgage is exactly that, a mortgage with a reversed payment steam where the mortgage pays you instead of you paying the mortgage. A reverse mortgage has several requirements; you must be 62 years of age and older, own your home and have enough equity. It can be used as a tax-free income without having to sell, give up title, or take on another mortgage payment.
Option ARM Mortgage
An option ARM mortgage is one that gives 4 payment options to choose from each month. One that tacts money onto the mortgage because the amount is calculated in a way that initial interest isn’t being covered so the unpaid interest gets tacked on the back end. The second is the interest only. The 3rd and 4th are 30 & 15 year amortized mortgages.
Selecting a Lender
Go with a trusted bank and talk to a seasoned, professional mortgage consultant. Direct lenders such as Wells Fargo will give you the best deal because they service their own loans, and they process a high volume of them.
If you need a mortgage we highly recommend Nicolas Moszoro of the Placerville branch of Wells Fargo. Nicolas has proved his commitment to getting the best rates available for his clients.
Nicks Contact Info here…
