Home | Contact Us | SUNIL SETHI REAL ESTATE
SMA Financing a Fremont mortgage company, serving San Francisco Bay Area Residents since 1992

Today's Rates | Loan Officers | Calculators | Apply Today | Loan Process | Taxes | Resources | About Us | Join Us

Loan Programs

1st ask yourself how long you plan to live in or keep the house:

Years you plan to keep 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 Year Fixed or 15 Year Fixed
10+  30 Year Fixed or 15 Year Fixed
 

Benefits and Disadvantages of Various Programs

Loan Programs Advantages Disadvantages
Fixed Rate Mortgages
30 Year Fixed
20 Year Fixed
15 Year Fixed
        10 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
Adjustable Rate Mortgages  (ARMS)
10/1 ARM
7/1 ARM
5/1 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
Balloon Mortgages
30/7 Year
30/5 Year
 
  • 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
First Time Buyer Programs  
  • Zero or low down payment
  • Easier to qualify
  • Sometimes you may get lower rates
 
  • 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.
No point, No Closing Cost Programs
(what are closing costs)		    
  • Higher rates
  • Higher payments
Home Equity Line of Credit  
  • 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
Home Equity Fixed Loan  
  • Fixed payments
  • Interest may be tax deductible
 
  • Higher interest rates than on 1st mortgages
  • Harder to refinance your first mortgage

  Still not sure what's best for you. Call us for a personal discussion on the options (more resources online)

Our Mortgage Loan Officers Always Put the Customer First, Taking You Forward

 

Today's Rates | Loan Officers | Calculators | Apply Today | Loan Process | Taxes | Resources | About Us | Join Us

Fremont Mortgage company, serving: Fremont, Newark, Union City, Oakland, Pleasanton, Diamond Bar, Temecula, San Diego, Hayward, Los Angles, La Jolla, Sacramento, Fullerton, San Francisco, Brisbane, Menlo Park, San Jose, Sunnyvale, Milpitas, Sherman Oaks, Tracy, Livermore, Dublin, Castro Valley, Pomona, Walnut Creek, Berkeley, San Leandro, Milbrae, Petaluma, Ontario, Marin, Manhattan Beach, San Mateo, San Ramon, Fremont, Newark, Union City, Danville, Alamo, Murietta, San Lorenzo 

SMA Financing is a California Licensed Mortgage Broker (License #01173766)

(c) 2003-2009 all rights reserved, Sunil Sethi, Broker, Owner, MBA, CPA