Option One Mortgage Loans - Getting An Option Arm Or Option One Mortgage Loan

Have you heard about or been interested in finding out more about option one mortgage loans? Are becoming very popular, but it is important to understand how they work before you apply for one. I will describe in this article, an overview of the most common type of option ARM mortgage loan or option one mortgage loan. How do they work? Option one mortgage loans are basically loans only to mortgage rates, except that the first year, you pay only 1.25% of the interest on the loan. For the rest of the interest that is accruing is added to the amount of the loan. The second year of the loan you pay more interest until gradually you are paying either full interest only payments or fully amortized payments (interest and principle). The reason that the loans are called option loans is because every time you have a payment due, you have the option of paying less partisan interests only, or paying only interest fully amortized. This option may be good in a situation where the income is sporadic. This type of mortgage is usually from 4 payment options in every bill. Here are the typical monthly payment options: Option # 1 - Pay a 15-Year fully amortized payment amount (CPI) option # 2 - Pay a 30-Year fully amortized payment amount (P & I) Option # 3 - the payment of interest only part of the loan (Interest Only) Option # 4 - Make a partial payment of interest (1.25% - 1.95% depending on the type of loan) and postpone the payment of additional interest for ' total amount of the loan. (Interest can be counteracted by making bi-monthly payments and appreciation on the part of the property) This type of loan is good if you want to: Wait a bit 'to refinance again - If interest rates fall again such payment. If you want to speed up payments and increase equity quick, pay more for your loan and will be applied to future payments and will be applied directly to the balance principle. You want a loan of 30 years? Maintain the option to pay the loan in 30 years, 15 years, or payments of interest only. Do you have an adjustable rate mortgage but want stability - This loan has a market capitalization of payment. The interest rate on the loan is based on the month 12-MTA index, the index most stable of the 4 main indexes (COFI, LIBOR, MTA, CMT). This index is always lower than the first. The interest rate is based on the world economic markets which have been falling steadily over the last 3 years. This loan is for 5 years the payment option set well. Invest your savings to pay for something else - This could open new opportunities for you if you could invest in real estate, the stock market or another investment when you use the extra $ 500-1000 + a month to free from payment of the property. Extinguish the debt payment savings - You can use the savings to pay the debt of others. Have security and options in your mortgage - The main advantage of this type of loan is the security of a mortgage payment that you control. You decide at any time, what kind of loan you want. If all goes well in your future, you have the freedom to pay the loan of 30 years of a loan of 15 years, without even consulting another mortgage broker. Get more home for your money - You can qualify for more home with these low payment options. Who is eligible? Qualifying for this loan is basically the same as any other loan, is based on credit, equity and fixed assets, if you are strong in 1 of these or 2 of these, you may qualify and probably with the lowest rate possible. What should I do to take out a loan stated income? "Stated income" or "No income / assets" loans are possible with this option a loan. These are only general guidelines and information on this type of loan. We want to discuss all these details with your broker or lender before you actually complete the loan. These factors may vary with each individual creditor. Many lenders do not offer their customers this type of loan. If you are looking for a loan or an option ARM option, you should speak to your broker about it or find an intermediary who can do this type of loan.