Which loan is right for me?

Loan Programs		Advantages		Disadvantages
Fixed Rate Mortgages		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		Lower initial monthly payment Lower payment over the first fixed period of the loan Payments may go down if rates trend down May qualify for higher loan amounts		Risk of increase in rates Payments may increase at time of rate adjustment
Interest Only ARMs		Lowest possible monthly payments May qualify for larger loan amount and more home now		Payments may increase significantly at time of rate adjustment and end of interest only period
First Time Buyer Programs		Lower down payment -100% financing availalbe 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.
Stated Income and No Ratio Loans		Do not need to verify income and/or calculate ratios Good solution for self-employed borrowers		Higher interest rates and higher payments Very good credit required More money down
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 refinance 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