1 Percent Mortgage Option Arm
1 percent Mortgage Option Arm products are flexible. A 1 percent mortgage option arm is used on my home and investment property.
An issue for many is managing income and expenses. Our mortgage is our largest expense, and the least flexible. The 1 percent mortgage option arm gives you control. Choose one of four 1 percent mortgage option arm payment options each month.
Minimum Payment A payment is set for 12 or 60 months at a reduced rate. The minimum payment rate for the 12 month option is 1% and the 60 month option is 1.90%. This may defer payment of interest allowing flexibility in managing tax deductions. Read about the tax considerations of a 1 percent mortgage option arm. For concerns over deferred interest, read about the small amount of appreciation required to offset it.
Interest Only Payment Defer paying principal and improve cash flow. This option is not available if the interest only payment is less than the minimum payment.
Fully Amortizing Payment Make a principal and interest payment based on either a 30 year or 15 year payment schedule. I have included a 1 Percent Mortgage Option Arm statement as well.
Choose your index from the 1 month LIBOR or the MTA.
Here is a 10 year comparison between a 30 year fixed and fully indexed LIBOR, MTA, COFI, and the 1 year Treasury Index in chart form.
Additional Options If you want the security of a fixed payment while taking advantage of the low 1 Percent Mortgage Option Arm payment rate, there is a 5 year fixed payment option. With the 5 year Fixed Payment, you have a fixed minimum payment for the first five years. Increase the term of your loan from 30 to 40 years lowering your payment further. LTVs on the 1% Mortgage Option Arm are up to 100%!
The Minimum Payment Advantage The example is based on a $400,000 mortgage. It compares a 30 year fixed rate based on the above 10 year average to the minimum payment available on the product. Assumes the Minimum Payment increases by the maximum 7.5% per year.
30 Fixed Minimum Monthly Savings Annual Savings
Savings over 3 years $52,872
I have developed a document detailing how this program works. Send me an email requesting a copy of "Understanding the 1 Percent Mortgage Option Arm".
I have a website dedicated to the 1 Percent Mortgage Option Arm.
Here is a 1 Percent Mortgage Option Arm payment calculator
Read important information about 1 Percent Mortgage Option Arm Prepayment Penalties
Read more about 1 Percent Mortgage Option Arm Closing Costs
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As a Certified Mortgage Planning Specialist, I offer an analysis of your situation today can make suggestions on how small changes in how your debt is structured today can have a life changing effect in the years to come. Read more about this free, no obligation service.