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Monthly Treasury Arm

Monthly treasury arm products have been developed by several lenders. I am so confident in the monthly treasury arm that I have converted my home, vacation home, and investment property to a monthly treasury arm. 

An issue for many is managing monthly income and expenses. Income varies monthly and unplanned expenses come up. For many, our mortgage payment  is our largest monthly expense, and the least flexible. The monthly treasury arm was designed to give you control over your mortgage payment. Choose one of four monthly treasury arm payment options monthly based on your specific cash flow needs.

        Monthly Treasury Arm 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 1.00% and the 60 month option is 1.90%. This option maximizes cash flow and may also defer payment of interest on your monthly treasury arm allowing greater flexibility in managing your tax deductions. This monthly treasury arm minimum payment can not increase by more than 7.5% each year. Read more about the important tax considerations of a monthly treasury arm. If you have concerns over deferred interest, read more 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 Options    You may make a principal and interest payment based on a 30 year or 15 year payment schedule. I have included an MTA Loan statement as well.

The product allows you to choose your index based on your needs. You can chose 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 are looking for the additional security of a fixed payment while still taking advantage of the extremely low monthly treasury arm payment rates, there is  a 5 year fixed payment option. With the 5 year Fixed Payment, you are guaranteed a fixed minimum payment for five years. You still have the four payment options to select from  to manage cash flow. And, you also may increase the term of your loan from 30 to 40 years lowering your payment even further. LTVs are up to 100%!

The Minimum Payment Advantage    The example below 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 MTA loan based on the 10 year average. Assumes the Minimum Payment increases by the maximum 7.5% per year.

                    30 Fixed                    Cash Flow Minimum                 Monthly Savings                    Annual Savings

Year 1        $2,855                                $1,287                                        $1,586                                    $18,816
Year 2        $2,855                                $1,384                                        $1,471                                    $17,652
Year 3        $2,855                                $1,488                                        $1,367                                    $16,404

                                            Savings over 3 years        $52,872
                                            Savings invested at 8%    $56,885

I have developed an Adobe document detailing how this program works. Send me an email requesting a copy of "Understanding the Monthly Treasury Arm".

I have added a website dedicated solely to Monthly Treasury Arm

Here is a useful Monthly Treasury Arm payment calculator

Learn more about investing

In 2008, Short Sales are where most of the bargains in real estate are and they are NOT just for investors. Learn more about Short Sales

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.

    Monthly Treasury ArmPrequalify for your Monthly Treasury Arm

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