Thirty-Year Fixed Rate Mortgage
The traditional 30-year fixed-rate mortgage has a constant interest rate and monthly payments that never change. This may be a good choice if you plan to stay in your home for seven years or longer. If you plan to move within seven years, then adjustable-rate loans are usually cheaper. As a rule of thumb, it may be harder to qualify for fixed-rate loans than for adjustable rate loans. When interest rates are low, fixed-rate loans are generally not that much more expensive than adjustable-rate mortgages and may be a better deal in the long run, because you can lock in the rate for the life of your loan.
 

Fifteen-Year Fixed Rate Mortgage
This loan is fully amortized over a 15-year period and features constant monthly payments. It offers all the advantages of the 30-year loan, plus a lower interest rate—and you'll own your home twice as fast. The disadvantage is that, with a 15-year loan, you commit to a higher monthly payment. Many borrowers opt for a 30-year fixed-rate loan and voluntarily make larger payments that will pay off their loan in 15 years. This approach is often safer than committing to a higher monthly payment, since the difference in interest rates isn't that great.

 

Hybrid ARM (3/1 ARM, 5/1 ARM, 7/1 ARM)
These increasingly popular ARMS—also called 3/1, 5/1 or 7/1—can offer the best of both worlds: lower interest rates (like ARMs) and a fixed payment for a longer period of time than most adjustable rate loans. For example, a "5/1 loan" has a fixed monthly payment and interest for the first five years and then turns into a traditional adjustable-rate loan, based on then-current rates for the remaining 25 years. It's a good choice for people who expect to move (or refinance) before or shortly after the adjustment occurs.


Adjustable Rate Mortgages (ARM)
When it comes to ARMs there's a basic rule to remember...the longer you ask the lender to charge you a specific rate, the more expensive the loan.


2/1 Buy Down Mortgage 
The 2/1 Buy-Down Mortgage allows the borrower to qualify at below market rates so they can borrow more. The initial starting interest rate increases by 1% at the end of the first year and adjusts again by another 1% at the end of the second year. It then remains at a fixed interest rate for the remainder of the loan term. Borrowers often refinance at the end of the second year to obtain the best long-term rates. However, keeping the loan in place even for three full years or more will keep their average interest rate in line with the original market conditions.


Annual ARM
This loan has a rate that is recalculated once a year.


Monthly ARM
With this loan, the interest rate is recalculated every month. Compared to other options, the rate is usually lower on this ARM because the lender is only committing to a rate for a month at a time, so his vulnerability is significantly reduced.


Conventional
Conventional loans, also known as Conforming loans, are the most popular type of mortgages. These loans are sold to Fannie Mae and Freddie Mac and must meet the underwriting guidelines set forth by Fannie Mae and Freddie Mac. Conventional loan products include 30 and 15 year fixed loans, as well as adjustable rate mortgages. In most areas, the maximum loan amount for a Conventional loan is $417,000. However, in certain “High Cost” areas, Conventional loan limits go to $729,750. In Summit County (where Park City is located) and Salt Lake County, the current Conventional loan limit is $729,750.


Jumbo Loans
Jumbo loans are mortgages with loan amounts greater than the Conventional loan limits set by Fannie Mae and Freddie Mac. In most areas, the maximum loan amount for a Conventional loan is $417,000, so a Jumbo loan is any loan with an amount above $417,000. However, in certain “High Cost” areas, Conventional loan limits go to $729,750. In these areas, Jumbo loans are loan amounts above $729,750. In Summit County (where Park City is located) and Salt Lake County, the current Conventional loan limit is $729,750.

Typical products for Jumbo loans include 30 year fixed, 15 year fixed and adjustable rate mortgages. Generally, rates on Jumbo loans are higher than rates on Conventional loans.


FHA Loans
FHA loans are provided by the Federal Housing Authority, which is part of the Department of Housing and Urban Development (HUD). The down payment may be as low as 3.50% of the sales price of the home. The maximum loan amounts for FHA loans are set by HUD and are based on the median income of each county. Therefore, the maximum amounts vary from county to county.

The advantages of FHA loans are the down payment requirements are lower than many Conventional loans and the credit standards are less restrictive.


FHA 203K Renovation Loans 
The 203(K) program allows a customer to purchase or refinance a home and make limited upgrades/repairs to the property all under one single loan. It is a great option when purchasing a home or condo that needs construction work to upgrade the property. The loan allows you to make a 3.5% down payment and receive enough money to purchase the property and make the necessary repairs/renovations.


USDA Rural Housing
Rural housing is a government program sponsored by the United States Department of Agriculture and is available in certain rural counties across the United States. It allows a person to purchase a property without any down payment and receive a very competitive interest rate on a 30 year fixed loan. The program is available in most Utah counties, including Summit and Wasatch counties. 


VA Loans
VA loans are mortgages backed by the Department of Veteran Affairs and allow qualified borrowers to purchase a home with no down payment. These loans are designed to make home ownership more affordable for people in the military, Veterans, Reservists and National Guardsman. Products include 30 year fixed loans and adjustable rate mortgages. The maximum loan amount in most areas is $417,000.


Reverse Mortgages
A reverse mortgage is a loan for senior homeowners and uses a portion of the home’s equity as collateral. No monthly payment is required during the term of the loan. The loan generally does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 6 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is inherited by the estate, not the lender. The estate is not personally liable if the home sells for less than the balance of the reverse mortgage.

To be eligible for a reverse mortgage, the Federal Housing Administration (FHA) requires all homeowners be at least age 62. The home must be owned free and clear, or all existing mortgages must be paid off with the new reverse mortgage. If there is a mortgage balance, it can be paid off completely with the proceeds of the reverse mortgage loan at the closing. Generally there are no income or credit score requirements for a reverse mortgage.
 

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