Wednesday, June 24, 2015

The Right Mortgage Option for You

When planning on investing for a house, we tend to turn to mortgage lenders to cover the cost. There are many banks who will offer you different kinds of mortgage but the real challenge here is to choose the right mortgage option for you.

Let’s look at the seven mortgage options you can choose from:

  • Fixed Rate Mortgage – as the name says, it is a mortgage with a rate that stays the same over the course of time. The downside is when the interest rates go at an all-time low, people who have locked into a higher interest rates years ago might find themselves paying more than they could with an adjustable-rate mortgage.
  • Adjustable Rate Mortgage – this type of mortgage has the upside of adjusting as the market moves. Of course those who are on strict budget may not keep up with this type of mortgage as the market sometimes fluctuates from time to time.
  • Federal Housing Administration Loan – suggested for first-time buyers but have limited amount on how much they can loan.
  • V.A. loan – or Veterans Affairs loan, is a guaranteed loan for veterans or the surviving family of veterans. This type of loan is guaranteed by the U.S. Department of Veterans affairs or may be issued by qualified mortgage lenders.
  • Balloon mortgage – ideal for people who are not staying at a certain place long term. They have fixed rates and low payments for a few years but have a certain point where you have to pay the amount in full.
  • Interest only – those who take this loan will only pay the interest for period of months but the balance will be due immediately after that period.
  • Reverse Mortgage – these allows seniors to turn their home equity into cash.

To help you, consult mortgage professionals like Vahe Hayrapetian. He and his team have years of experience and would gladly study what mortgage option is best for you.

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