Which Loan is Right for Me?

This is a complicated question, one that has no hard and fast answers, only more questions. There are many variables in establishing home ownership, besides the obvious financial wherewithal, lets look at the most basic question.

How many years you plan to stay in the house has a direct bearing on the type of loan which makes the most sense.

Statistically, people move about every 5 years or so. Rarely do you find folks who stay in the same home for 20, 30 years or longer these days. There are a variety of tools that can allow you to get the most home you can afford, if used properly.

We offer a variety of loans and are able to deal
with all types of credit issues.

Traditional, conforming "A: paper loans, through borrowers with previous bankruptcy and foreclosures.

Purchase a new, investment or vacation property

Texas home equity loan for cash out and debt consolidation.

Loan Programs Advantages / Disadvantages

Fixed Rate Mortgages

30 year / 15 year are the most common terms, 10 and 20 year loans are available, even 40 and 50 year loans' are available, subject to lender credit requirements.

Monthly payments are fixed over the 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 (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

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 rate
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.

Stated Income Programs

Don't need to verify income
Perfect for self employed borrower's
Faster approval
Higher rates
Higher down payment

Imperfect Credit Programs

Potential for re-establishing credit, if you pay your mortgage on time.
When combined with debt consolidation, you may be able to reduce your monthly debt payment and actually own your home sooner.
Higher rates
Terms may not be as favorable
Harder to get long term fixed loans
Loans may have prepayment penalties

Home Equity Loan (more information)