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Option ARM Real Estate LoanOption ARM Real Estate Loan products are available from several lenders several lenders. I have recently converted both my home and investment property to the Option ARM Real Estate Loan. An issue for many homeowners is in managing monthly income and expenses. Income varies and unplanned expenses come up. For many, our mortgage payment is our largest expense, and the least flexible. The Option ARM Real Estate Loan was designed to give you control over your mortgage payment. Choose one of four option arm payment options each month based on your cash flow needs. Minimum Payment A payment that 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 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 an option arm real estate loan. If you have concerns over deferred interest, read about the small amount of appreciation required to offset it. Interest Only Payment Defer paying principal and improve your 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 a Option ARM Real Estate Loan statement as well. The product allows you to choose your index from the 1 month LIBOR or the MTA. 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 additional security of a fixed payment while taking advantage of the low payment rate, there is a 5 year fixed payment option. With the 5 year Fixed Payment, you have a fixed minimum payment for five years. You still have the four payment options to select from monthly to manage cash flow. And, you have the ability to increase the term of your option arm from 30 to 40 years lowering your payment. LTVs are available 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 based on the 10 year average. Assumes that 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
Savings over 3 years $52,872 Please feel free to email me with any questions about the Option Arm Real Estate Loan Learn more about Option Arm Real Estate Loan Closing Costs I have developed an Adobe document detailing how this program works. Send me an email requesting a copy of "Understanding the Option Arm Real Estate Loan". I have added a website dedicated solely to the Option Arm Real Estate Loan.
Here is a useful
Option Arm
Real Estate Loan payment calculator
Read very important information about
Option Arm Real Estate Loan Prepayment Penalties 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
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