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 is rates go down

Higher Interest Rate.

Higher mortgage payments

Rate does not drop if interest rates improve

10/1ARM

7/1 ARM

3/1 ARM

1 year ARM

6 month ARM

1 month ARM

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

Use the home’s equity to pay closing costs.

Cost of refinance may be tax deductible

May be subject to property
value and credit limitations

No closing costs

Less money required to close

Higher rates

Higher payments

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

You only borrow what you need

Pay interest only on what you borrow

Flexible access to funds

Interest may be tax deductible

Rates can change.

The maximum interest rate is normally high.

Payments can change.

Harder to refinance your first mortgage

Fixed Payments

Interest may be tax deductible

Higher interest rates than on 1st mortgages

Harder to refinance your first mortgage