Below is a general "Rule of Thumb" to
use when deciding which Magic Funding Group
loan program is best for you, and a description
of
common loans available to today's borrowers.
Years you
plan to stay in the house
Recommended
program
1-3
3/1 ARM, 1 year ARM or 6 month ARM
3-5
5/1 ARM
5-7
7/1 ARM
7-10
10/1 ARM, 30 yr fixed or 15 yr fixed
10+
30 year fixed or 15 year fixed
Loan Programs
Advantages
Disadvantages
30 year
fixed
15 year fixed
· 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
· Lower initial monthly payment
· Lower payment 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
· Lower initial monthly payment
· Lower payment over a shorter period of time
· Many balloon mortgages offer the option to convert to a new loan after
the initial term.
· Risk of rates being higher
at the end of the initial fixed period
· Risk of foreclosure if you cannot make balloon payment or if you cannot
refinance or if you cannot exercise the conversion option
· Lower down payment
· Easier to qualify
· Sometimes you may get lower rate
· 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.
· 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 prepayment penalties
A jumbo mortgage is a mortgage loan which is larger than the limits set by Fannie Mae and Freddie Mac ($417,000 as of January 2008).
Since these two agencies will not purchase these types of loans, they usually carry a higher interest rate (to enhance their value and marketability to investors).
Besides our standard loan programs,
we also have a large number of unique programs to serve
your needs including:
· Purchase a house
with 0 down
· Piggyback loans 80-10-10 or 80-15-5. No PMI payments even with 5% or
10% down.
· Debt consolidation programs
· Home Improvement loans
· Qualify even if you may have been turned down before! ·Commercial
Loans ·Investment
Properties
