Which Loan Program Will Best Suit Your Needs?

Which Loan Program Will Best Suit Your Needs?

No one program is right for everyone, or every situation, which is why at Shoreline Mortgage we have developed a large menu of programs to provide the best options to our borrowers. So whether you need a loan with no money down, or maybe you are self-employed and you need a no-income verification loan, or you need low payments in the beginning, or maybe you even had a few credit problems, or even a bankruptcy in the past. At Shoreline Mortgage we can customize a mortgage program to fit almost any situation.

30 Year Fixed
A 30-year fixed rate mortgage is best for those borrowers who wish to keep the payment as low as possible, and also intend to own this home for at least 10 to 15-years. A 30-year fixed rate gives you the security of knowing that your rate (and payment) will not increase, and also spreads your payment over the longest possible amount of time. The drawbacks are simply, the rates are sometimes slightly higher than an adjustable rate mortgage, and a borrower will pay a much larger amount of interest of 30-years than over a shorter time period.

15 Year Fixed
A 15-year fixed rate mortgage is best for those who can afford it. You have the same payment stability that is found in a 30-year fixed rate mortgage, but your payment is spread over a shorter period of time. You can therefore build equity in your home much more quickly, and a larger percentage of your monthly payment goes directly to debt reduction, and not interest. The rates tend to be lower on a 15-year fixed rate mortgage than they are on a 30-year fixed rate mortgage.

Adjustable Rate Loan
An Adjustable Rate Mortgage traditionally provides the lowest available payment, but in return the payments can change on a regular basis. The more frequent the changes are allowed, the lower the interest rate tends to be. For instance an adjustable rate mortgage which adjusts or changes every 6 months, will tend to be lower than the higher interest rate for a mortgage which adjusts every three years. The amount of the change is governed by two factors, one is the margin and the second is the index. The index is the meter which will be used to determine what the rate will be, the most common examples of an index are the 1 Year T-Bill, and the LIBOR (London Inter-Bank Offering Rate). The margin is simply what amount will be added to the index to determine your new rate on the change date. So if your index is the Prime Rate, and it is 6%, and your margin is 2%, your rate would be 8%.

If you are planning to stay in your existing or new home for a specified period, adjustable rate financing may be your best choice. 1st time homebuyers who are likely to upgrade to a larger home should consider this option closely. . Adjustable rates also have maximum caps which can be adjusted upwards or downwards. The initial fixed term on an adjustable loan can be for as little as a month or as long as 10 years. It is important to determine how long you intend on being in your home to allow for good choice on the type of adjustable rate program which you would consider. Any of our loan officers will be happy to explain the details.

Balloon
.A balloon mortgage is for those who want the rate and payment stability provided by a fixed rate mortgage, and the lower monthly payments found with a longer term loan, but only intend to be in their home for a short period of time. The payments for a balloon mortgage are calculated as if the loan was a 30-year fixed rate mortgage, but the term of the loan is much shorter (typically from 3-15 years). This shorter term reduces the RateStar.com's liability, so a lower interest rate can be charged. Basically if you know for a fact that you will only be in your home for a very short period of time, and your primary concern is having the lowest possible stable payment, than a balloon mortgage is for you. But beware, at the end of a balloon mortgage the full outstanding balance comes due and needs to either be paid or refinanced at that time.

No Income Verification Loans
Are you self-employed? Have you made a recent career change in less than a year? Do you want to maintain privacy regarding your tax returns? These are some examples of why people choose a no-income loan option. No-Income programs typically require that a borrower has more equity in the transaction. Lenders will also charge a slightly higher interest rate for these transactions as being riskier since they have not substantiated the earning power of the borrower. Contact your loan officer to determine if you qualify.

No-Doc Loans
A no doc program provides a borrower with the opportunity to secure a mortgage without disclosing any asset or income information. The rates are higher due to the increase in the loan risk. Less information=more risk. A no-doc loan concentrates on the borrowers credit and the value of the property. These loans will typically require equity of 30% or more and an excellent credit history. Borrowers who are between jobs, retired or have recently come into money due to inheritance may explore no-doc lending options with one of our loan officers.

Non-Owner Occupied Investor Programs
Investment properties are generally defined as a property being rented. 2nd (vacation) homes are not considered to be investment properties. An investment property cannot consist of more than four rental units. These mortgages require complete documentation about the borrower and the property. Typical down-payment requirements are as much as 30% of the purchase price. Interest rates can be fixed for as long as 15 to 30 years. The rates are generally pegged about 1/4 percent higher than normal owner occupied rates.

Equity Lines of Credit
If you own a home and want to do various home improvements, a home equity loan may be the ideal choice. Home equity loans are used for a variety of needs including debt consolidation, medical, vacation property purchases, and almost anything else one might consider. A HELOC is a second mortgage that provides you with funds as needed without disturbing your existing 1^st mortgage. Home equity lines of credit (HELOCS) operate differently then most mortgage products. A HELOC is an actual line of credit. Interest is only charged when funds have been drawn across the account. Funds can be paid back, only to be available on demand when needed later. HELOC interest rates are pegged to prime plus a margin of zero to four or more percent. Allowable loan amounts differ from program to program. One general rule of thumb is 80% of the property value minus the existing 1st mortgage. Some HELOC programs can access all remaining equity in a home. Make sure you consult your accountant about the various tax advantages that may be available to you prior to securing your loan.

For a more in depth look at loan types... click here

Shoreline Mortgage Corporation
4000 Hollywood Boulevard
Hollywood, Florida 33021
Toll Free (888) 353-1558
Phone (954) 966-1313
Fax (954) 966-3606
E-Mail Loans@ShorelineMTG.com

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