Which mortgage is best for me?
The answer to this question is based upon the timeframe you plan on staying in the home. If the possibility is strong that you will be relocating/selling in a three to seven year time frame you may want to take advantage of the lower rates offered in a balloon mortgage or interest only loan. If there is some uncertainty of your length of stay in the home you may opt for the lower rate A.R.M. If you feel certain that your length of stay will be long term, then the fixed rate loan would be best for you. Fixed rate loans vary in term, therefore it is best to ask your loan advisor to give you payments on each term so you can decide what is best for your financing goals.

When should I pay points?
The misconception of paying points for a mortgage being a bad thing depends on how long you will hold the mortgage. For example: if you are planning on keeping your mortgage for the full term and you qualify for a rate of 6% on a thirty year fixed rate mortgage and borrow $100,000, your payment is $599.57. Now if it cost you $1000 (one point) to receive a rate of 5.75%, your payment falls to $583.57. Simply take the difference in payments and divide that number into the costs to receive the lower rate. 1000/(599.57-583.57)=62.57 months. Therefore every month after the 62.57 month timeframe you will save $15.98. Now if you apply the payment savings to the mortgage at 5.75% you will save $14,398 in payments. Not bad for a $1000 investment!

How much do I need for a down payment?
You no longer need 20% down to purchase a home. We have numerous 100% financing options. There are also 80/20% loans available without PMI (Private Mortgage Insurance). If you are currently renting and would like to own your own home, please give us a call. It only takes a few minutes to pre-qualify.

When should I refinance?
If you are looking to refinance your current mortgage balance only, having to drop your interest rate by 1 percentage point is a myth. It goes back to the same principal as above whether to pay points or not. The length of time in the home will determine if you should refinance or not. If the payment savings is not recaptured in the timeframe you will remain in the loan, it does not pay. But if you carry the loan long enough to get back your cost of the refinance and hold the loan thereafter it may make sense.