Cash Flow ARM
Cash Flow ARM products are flexible. I use the Cash Flow ARM on both my home and investment property. I am a mortgage broker specialized in the Cash Flow ARM with 37 lenders offering the Cash Flow ARM to ensure you get the best mortgage for your specific situation.
An issue for many is managing income and expenses, or "cash flow". Income varies and unplanned expenses come up. Our mortgage payment is our largest expense, and the least flexible. The Cash Flow ARM gives you control over your mortgage payment. Choose one of four cash flow arm payment options based on your cash flow needs.
Cash Flow ARM Minimum Payment A payment is set for 12 or 60 months at a reduced rate. The cash flow arm minimum payment rate for the 12 month option is currently 1.00% and the 60 month option is 1.90%. This maximizes cash flow and may defer payment of interest allowing greater flexibility in managing your tax deductions. This minimum payment can not increase by more than 7.5% each year. Read about the important tax considerations of a cash flow arm. For concerns over deferred interest, read about the small amount of appreciation required to offset it.
Cash Flow Arm Interest Only Payment Defer paying principal and improve cash flow. This option is not available if the interest only payment would be less than the minimum payment.
Fully Amortizing Payment Options Make a principal and interest payment based on either a 30 year or 15 year payment schedule. I have included a Cash Flow ARM statement as well.
The Cash Flow Arm allows you to choose your index from the 1 month LIBOR (London Interbank Offered Rate) or the MTA (12 Month Treasury Average).
Here is a 10 year average 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 still taking advantage of the low payment rates, there is a 5 year fixed payment option. You still have four payment options to select from to manage your cash flow. You also have the ability to increase the term of your loan from 30 to 40 years lowering your payment even further. LTVs are now available up to 100%!
The Minimum Payment Advantage This example is based on a $400,000 mortgage. It compares a traditional 30 year fixed rate payment based on the above 10 year average to the minimum payment available on the Cash Flow ARM again based on the 10 year average. Assumes that the Minimum Payment increases by the maximum 7.5% per year.
30 Fixed Minimum Payment Monthly Savings Annual Savings
Savings over 3 years $52,872
Here is a useful Cash Flow ARM payment calculator
Read very important information about Cash Flow Arm Prepayment Penalties
Learn more about Loan Modification. If you can not refinance, it may be the best way to save your home today.
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