There are many more loans you can choose from but this week I wanted to discuss what I believe to be the 5 best loans to choose from. So we end our First Time Home Buyer Week with ARM loans.
ARM, which stands for adjustable rate mortgage, is a loan that features a fixed rate period of either 3, 5, or 10 years. After the fixed rate period the interest rate changes each year following and can fluctuate either up or down.
Now I know you are probably thinking, why would anyone choose this type of loan knowing that the interest rate will not always stay the same? ARM’s are for those that do not want a long term mortgage and plan on moving within a few years. By choosing an ARM, you get a lower interest rate and lower monthly payment and according to U.S. Bank, this gives you the option to pay down your mortgage faster. If you are planning on making a home your forever home though, then I would not recommend this loan. The credit and down payment requirements are the same as the fixed rate conventional loan as discussed in yesterday’s post.
To find out more information, feel free to give us a call here at Thomco Properties and let us walk with you through every step in your home buying process and help you find a house to call home.