H & R Mortgage home financing, mortgages, refinancing with the Helpful Hat Lady. H & R Mortgage home financing, mortgages, refinancing with the Helpful Hat Lady.
H & R Mortgage home mortgage loans with the Helpful Hat Lady.
H & R Mortgage home financing, mortgages, refinancing with the Helpful Hat Lady. H & R Mortgage home financing, mortgages, refinancing with the Helpful Hat Lady. H & R Mortgage home financing, mortgages, refinancing with the Helpful Hat Lady.

Mortgage Loan Processing Made Easy, 2-DVD Set & Book, Buy Now or Get Info

Which Loan Is Right for Me?


Years You Plan to Live in the House Recommended Program
1-3 3/1 ARM, 1-year ARM, 6-month ARM
3-5 5/1 ARM
5-7 7/1 ARM
7-10 10/1 ARM, 30-year fixed or 15-year fixed
10+ 30-year fixed or 15-year fixed

Loan Programs Advantages Disadvantages
Fixed Rate Mortgages
30 year fixed
15 year fixed
• Monthly payments are fixed over life of the loan
• Interest rate does not change
• Protected if rates go up
• Can refinance if rates go down
• Higher interest rate
• Higher mortgage payments
• Rate does not drop if interest rates improve
Adjustable Rate Mortgages
10/1 ARM
7/1 ARM
3/1 ARM
1 year ARM
6 month ARM
1 month ARM
• Lower initial monthly payment
• Lower payment over a shorter period of time
• Rates and payments may go down if rates improve
• May qualify for higher loan amounts
• More risk
• Payments may change over time
• Potential for high payments if rates go up
Balloon Mortgages
7 year
5 year
• Lower initial monthly payment
• Lower payment over a shorter period of time
• Many balloon mortgages offer the option to convert to a new loan after the initial term
• Risk of rates being higher at the end of the initial fixed period
• Risk of foreclosure if you cannot make balloon payment or if you cannot refinance or if you cannot exercise the conversion option
First-Time Buyer Programs • Lower down payment
• Easier to qualify
• Sometimes you may get lower rates
• May be subject to income and property value limitations
• Some programs which have government subsidies may have a recapture tax if you sell the house too early.
Interest Only Mortgages • Good for people who expect to make a lot more money in the near future
• Lower payments during interest-only period
• Helps you qualify for a larger loan amount and maybe a larger home
• More risk
• Anticipated income growth may not happen
• Greatly increased monthly payments at end of interest-only period
• If home values decrease, your mortgage may be greater than the value of your home
Stated Income Programs • Don't need to verify income
• Faster approval
• Higher rates
• Higher down payment
No Point, No Fee Programs • No closing costs
• Less money required to close
• Higher rates
• Higher payments
Imperfect Credit Programs • Potential to re-establish credit if you pay your mortgage on time
• When used for debt consolidation, you may be able to reduce your monthly debt payments
• Higher rates
• Terms may not be as favorable
• Harder to get long-term fixed loans
• Loans may have prepayment penalties
Home Equity Line of Credit • You only borrow what you need
• Pay interest only on what you borrow
• Flexible access to funds
• Interest may be tax deductible
• Rates can change. The maximum interest rate is normally high
• Payments can change
• Harder to finance your first mortgage
Home Equity Fixed Loan • Fixed payments
• Interest may be tax deductible
• Higher interest rates than on 1st mortgages
• Harder to refinance your first mortgage

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