• 15 year fixed
• 20 year fixed
• 30 year fixed
• 40 year fixed

• The mortgage monthly payments will be fixed for the life of the loan
• Your interest rate will not change
• You are protected if interest rates should rise
• You can refinance if the interest rates should drop

• Interest rates are slightly higher
• Your mortgage payments will be higher
• Your rate will not drop if the interest rates drop

• 10/1 ARM
• 7/1 ARM
• 5/1 ARM
• 3/1 ARM
• 1 year ARM
• 6 month ARM
• 1 month ARM

• Lower monthly payment during the initial term
• The rates and payments may drop if rates drop
• You may qualify for a higher Mortgage
• You will have a 30 year term, and usually no balloon payment

• Greater risk
• Your payments may rise over time
• There is a potential for your payments to increase if the interest rates should increase

• 7 year
• 5 year

• Lower payments during the initial term
• A lower mortgage payment for a the predetermined term
• Most balloon mortgages offer you  the option to extend the mortgage after the initial term under certain conditions and with a one time interest rate change based on a pre-determined formula after the initial term 

• There is a risk that rates will be higher at the end of the initial fixed rate term
• There is a risk of foreclosure if at the end of the initial term you are unable to make the balloon payment, refinance, or exercise the option to extend your mortgage
• You may have to sell or refinance the property if you are unable extend the mortgage when the balloon comes due as opposed to a 7/1 or 5/1 ARM program with a 30 year term

• Allows a lower down payment
• It is easier to qualify
• Special lower rates may be available

• The loan may be subject to income and property value limitations
• If your loan is government subsidized you may generate a recapture tax if you sell the home too soon
• A special education class may be required in order to qualify for these mortgages

Stated Income Programs

**This program is no longer available***

• You will not have to verify your income
• Faster approval
• This program is useful for borrowers who may not be able to document all of their income or who have complex income tax returns

• Your  interest rate will be higher
• Your down payment may be higher

• You can pay interest only or you can pay extra toward the principal balance
• Your monthly payments will be lower
• You may qualify for a higher mortgage amount
• You will be qualified based on the interest payment
• You have the option to pay more than the interest payment
• The minimum interest only payments are for the first 10 years
• Use the extra monthly cash flow for investments

• The interest rates are slightly higher
• The principal balance will not go down unless you pay more than the minimum interest payment 
• At the end of the 10 years the payment on the remaining balance will be increased to pay off the loan over the remaining 20 years

• You pay no mortgage closing costs at closing except the prepaid expenses
• The mortgage is not increased to cover the closing costs
• The closing costs are paid by the lender from the higher price he receives when he sells a mortgage that has a higher interest rate
• You need less money to close your loan
• You can refinance your mortgage without increasing  loan amount

• You will have a higher interest rate
• You will have higher mortgage payments
• You may have to pay a penalty if you refinance or pay off the loan in less than 4 to 12 months
• Some loans will have a prepayment penalty during the first one to five years
• You will have to pay the prepaid expenses at closing: (the prepaid interest for the balance of the first month and the amount needed to fund your escrow account for real estate taxes and insurance)

• You have the opportunity to  reestablish your credit if you make your mortgage payments on time
• If also used to pay down credit cards you should be able to improve your monthly cash flow

• The interest rates are higher
• The terms of the loan may not be as favorable
• The loans may not have long term fixed interest rates
• The mortgages may have prepayment penalties

• You only draw what you need from time to time
• You only pay interest on the amount that you have drawn
• You can draw from the account by writing a check and in some cases from an ATM machine
• The interest may be tax deductible whereas the interest on consumer debt is not tax deductible
• The loan may have no closing costs or low closing costs
• It is a good emergency fund, if you have set it up in advance
• It can be used to pay off credit cards or other debts and reduces the need for reserve funds in your checking account
• The interest rates are usually lower than the rates on your consumer debt or credit cards

• The rates can increase if the bank Prime Rate increases
• The payments will increase if the interest rate increases
• It may be harder to refinance your first mortgage if the total of your first mortgage and the HELOC exceed 95% of the value of your Home
• If the appraised value of your home drops the amount available to draw may be reduced

• The interest and payments are fixed for the life of the loan
• The interest may be tax deductible
• You can get cash out at closing for any purpose

• The interest rates will be higher than a first mortgage
• It may become harder to refinance your first mortgage
• The payments are based on the original loan amount, as compared to the changing payments based on the changing balance of a HELOC