You Have Mortgage Options! Which Is Right For You?

Mortgage loan agreement application with house shaped keyring

What you need to know about your mortgage options.  

You already know that buying a home is one of the biggest decisions your family will ever make, and you’re probably being very careful about the home you choose. You want to end up in the right one, after all.

Similarly, you should be careful about the mortgage you choose. To help you pick the right type of financing, here is a look at your mortgage options.

  • Fixed Rate Mortgage: When you pick a fixed rate mortgage, you lock in a specific interest rate that you’ll pay for the life of your loan. That means you’ll pay the same amount to your lender each month, even 10 years down the road. If you plan to be in your home for the long-term, a fixed rate mortgage is for you.
  • Adjustable Rate Mortgage: ARMs start off more affordable than fixed rate ones, but their rate will fluctuate over time. Generally, this means that your interest rate will increase, so be prepared to pay more for your home down the road than you will when you first get into it. ARMs are best for people who plan to sell in a few years or can expect salary increases over time.
  • 5/1 ARM: This type of mortgage has a fixed rate for the first five years, then switches to an adjustable rate with the rate adjusted annually (i.e. 5 years fixed/adjusted every 1 year after that). If you plan to sell in 8 years or less, this a great financing option for you.

Would you like to learn more about the choices your family has for financing your home? To talk to a local mortgage expert who can help you pick the perfect loan for your short- and long-term needs, contact Avis Lending today. With offices in Irvine, California and Lahaina, Hawaii, we’re here to see to all of your West Coast mortgage needs.

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