MTA Loan Information

MTA loan products are flexible. An MTA loan is used to finance my home and investment property.

An MTA loan helps manage income and expenses. Income varies and unplanned expenses come up. For many, our mortgage payment is our largest monthly expense, and the least flexible. MTA loan products are designed to give greater control over your mortgage payment. Choose one of four MTA loan payment options monthly based on your cash flow needs.

MTA Loan Minimum Payment A payment that is set for 12 or 60 months at a reduced rate. The minimum payment rate for the 12 month MTA loan option is 1.00% and the 60 MTA loan month option is 1.90%. This maximizes cash flow and may defer payment of interest allowing greater flexibility in managing your tax deductions. Plus, this MTA loan minimum payment can not increase by more than 7.5% each year. Read more about the important tax considerations of an MTA loan. If you have concerns over deferred interest, read more about the small amount of appreciation required to offset it.

MTA Loan 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 MTA Loan 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 are looking for the additional security of a fixed payment while still taking advantage of the extremely low MTA loan 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

Learn more about MTA loan closing costs.

I have developed an Adobe document detailing how this program works. Send me an email requesting a copy of "Understanding the MTA loan". I will send to you.

I have added a website dedicated solely to the MTA Loan.

Here is a useful MTA Loan payment calculator

Read very important information about MTA Loan Prepayment Penalties

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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 consumer and mortgage debt is structured today can have a life changing effect in the years to come. Read more about this free, no obligation service.