Loans

Mortgage Loan Options

Types of Loans

30-year fixed

30-year fixed-rate mortgages provide stable rates and payments for the life of the loan. This means that your payments will not change for the 30 years you have the loan. This is a good loan option to consider when mortgage rates are historically low - you can secure a low rate for the full life of the loan. You should consider this type of loan if you want rate and payment stability, want to take advantage of current low rates, and are planning on staying in your house for a long time.

15-year fixed

Like a 30-year fixed rate loan, 15-year fixed-rate mortgages provide stable rates and monthly payments for the life of the loan. With the 15-year loan, you build equity faster. The shorter loan term results in higher monthly payments, but it also means that you end up paying less interest - saving you money in the long run. You should consider this type of loan if can afford to pay a little more each month and are attracted to the idea of saving money overall and getting your loan paid off in half the time - if you are close to retirement, for example.

5-year ARM

With the 5-year Adjustable-Rate Mortgage (ARM), the rate and payments are fixed for the first five years of the loan, and then they are adjusted once or twice each year after that (to more closely match the current market rates at that time). One advantage of this type of loan is that the initial interest rate is usually lower than you can get for a 30 or 15-year fixed rate loan - meaning that your payments may be lower for the first 5 years of the loan. After that, however, the rate and payments will adjust to prevailing market rates. This loan is a good option for people who want a low initial rate, and who may move to a new property or refinance their mortgage before the initial 5-year fixed period is over.

3-year ARM

The 3-year ARM provides rate and payment stability for the first three years of the loan. After that, your rate and monthly payment may change every year for the remaining life of the loan. Because the initial rate is usually lower that that offered for 15 or 30-year fixed rate loans or 5 year ARMS, this loan could be a good option if you plan to sell your home or refinance within a few years - you could get a bargain rate for the first three years.

Frequently Asked Questions

* Not to be construed as a loan application or a commitment to lend. Rates are subject to change at any time and without advance notice.

Loans

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