| CONVENTIONAL LOANS
|
| Fixed Rate Mortgages are typically 30 or 15 year
terms. The interest rate does not change for the life of the loan. Depending on
the property, qualifying income and other factors, minimum downpayment
requirements can be a little as 3 to 5% of the sales price.
|
 |
Adjustable Rate Mortgages,
or ARMS, are loans in which the interest rate is set for a specific period of
time and will then adjust to a current "market" rate. There is a "cap" on the
rate at the time of adjustment. 10/1, 7/1, 5/1, 3/1, and 1/1 ARMS offer lower
payments than fixed rate loans. ARMS may make sense for buyers who plan to sell
and move in a particular time frame. For example, a military purchaser facing a
future transfer may choose a 5/1 ARM. The 5/1 ARM rate is lower than the
current fixed rate and 5 years is the maximum time he/she needs to cover the
transfer. We also have available 100% financing on some of our ARM programs. |
| First Time Homebuyer, Limited Documentation and 2nd Trust
Mortgages are also offered at PMC. Purchase money 2nd trust
benefits are more fully detailed on a separate web page titled "Conventional
Loans- No MI".** |
| ** Loans with downpayments of less than 20% generally require
mortgage insurance (MI). Mortgage insurance was designed to protect the lender
for losses in the event of foreclosure. See how to avoid "MI" with as little as
5% down. |
back to the top
|
| GOVERNMENT LOANS |
| FHA Mortgages are the original first time homebuyer
loans. The success of this program is due to the fact that FHA requires less
downpayment, qualifies the borrower for a higher loan amount, and is more
liberal with regards to credit issues compared to Conventional loans. In
addition, these loans are assumable to future buyers when the home is sold. FHA
offers a fixed rate and a 1/1 adjustable with 2.25% downpayment. The current
maximum FHA loan for the Washington metropolitan area is $234,650. |
| VA Mortgages are Veterans Administration loans to
veteran-eligible borrowers. Fully eligible veterans can obtain 100% financing.
VA loans also carry some similar characteristics to the FHA loans. VA currently
has a $203,000 loan maximum. |
