Reverse Mortgages

A reverse mortgage is a special type of loan made to older homeowners to enable them to convert the..

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Interest Rate

The most common buydown is the 2-1 buydown. In the past, for a buyer to secure a 2-1 buydown they would pay...

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Loan Programs

Fixed Rate Mortgages - The most common type of mortgage program where your monthly payments for interest and principal never change...


Standard ARMS and the Differences - Choosing an ARM with an index that reacts quickly lets you take full advantage of falling interest rates...


Introductory Rate ARM's - Most ARM's have a low introductory rate, which is good anywhere from 1 month to as long as 10 years...


Reverse Mortgages - A Special type of loan made to older homeowners to enable them to convert the equity in their home to cash to finance other needs...


London Inter Bank - LIBOR is the rate on dollar-denominated deposits, also know as Eurodollars, traded between banks in London...


Interest Rate Buydowns - The buyer would pay points above current market points in order to pay a below market interest rate during the first two years of the loan...


Cost of Funds Index (COFI) - The ratio of the dollar amount paid in interest during the month to the average dollar amount of the funds for that month...


Graduated Payment Mortgage (GPM) - With a GPM the payments are usually fixed for one year at a time.


Choosing The Best Program - The right type of mortgage for you depends on many different factors


Fixed Rate Mortgages

The most common type of mortgage program where your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments will be very stable.

Fixed-rate mortgages are available for 30 years, 20 years, 15 years and even 10 years. There are also "bi-weekly" mortgages, which shorten the loan by calling for half the monthly payment every two weeks. (Since there are 52 weeks in a year, you make 26 payments, or 13 "months" worth, every year.)

Fixed rate fully amortizing loans have two distinct features. First, the interest rate remains fixed for the life of the loan. Secondly, the payments remain level for the life of the loan and are structured to repay the loan at the end of the loan term. The most common fixed rate loans are 15 year and 30 year mortgages.

During the early amortization period, a large percentage of the monthly payment is used for paying the interest . As the loan is paid down, more of the monthly payment is applied to principal . A typical 30 year fixed rate mortgage takes 22.5 years of level payments to pay half of the original loan amount.