Financial Consultants

Purchasing a new home is one of the most complicated transactions you will make. The most complex aspect of this transaction is the arrangement of financing. However with the assistance of a reliable mortgage company the loan process can move smoothly.

First consider what type of mortgage will best suit your financial plan and the house you choose. Financial Consultants offers different types of loans that will meet the needs of virtually every potential customer, and we even have programs that offer NO money down or low documentation.

The following are the different types of mortgages in the market today.

Fixed Rate Mortgage(FRM) - are loans paid off in equal payments over the term of the loan. These loans are also called level payment mortgages. The rate for this type of mortgage is at a constant level throughout the term.

Adjustable Rate Mortgage(ARM) - are loans that change interest rates with a predetermined market index. There are a variety of market indexes used, and the index will be set when the loan is made. This is one of the most popular loans in the industry at the current time.

Interest Only(IO) - are loans that you pay only interest, no principle reduction is required. It has 3, 5 or 10 year terms and then converts to an adjustable rate mortgage. This program allows you to earn equity in the house with an increase in appreciation, not payment reductions. It is one of the newest loan programs on the market and is rapidly growing in popularity.

Loan Programs	Advantages	Disadvantages
Fixed Rate Mortgage
30 year Fixed 15 year Fixed	Fixed monthly payments over the life of the loan Interest rate doesn’t change if rates go up Protected if rates go up Can refinance if rates go down	Higher interest rates Higher mortgage payment Rate doesn’t drop if interest rates improve
Adjustable Rate Mortgage
2/28 ARM 3/27 ARM	Lower initial monthly payment Avoid mortgage insurance Lower payments 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
First Time Buyer Programs
	Lower down payment Easier to qualify Sometimes you may get lower rates	May be subject to income and property value limitations
Stated Income Programs
	Do not need to verify income Faster approval	Sometimes higher rates Higher down payment Need higher credit score
No Point, No Fee Programs
	No closing costs Less money required to close	Higher rates Higher payments
Imperfect Credit Programs
	Potential for reestablishing credit if you pay your mortgage on time When used for debt consolidation, you may be able to reduce your monthly debt payment	Higher rates Terms may not be as favorable Harder to get long term fixed loans Loans may have pre-payment penalties
Interest Only Programs
	Significantly lower payments Sometimes lower rates May qualify for higher loan amounts due to lower payments	Subject to credit limitations
Home Equity Programs
	Allows borrower to remove cash from equity to use at their discretion Sometimes you may get a lower rate during refinance	Cannot be refinanced for the first year of term

Texas Broker License #1816