Apply Online          

Welcome
to TMC Lending!
 Your source for consumer information  

 

 




FHA Loan

Construction/Perm

Interest Only Mortgage


Commercial Loans

   
Real Estate Investor


Refinance


Loan Modification





Virginia Option ARMs

Option ARMs products, available in Virginia, are available from several lenders. I have converted my Virginia home and investment property to Virginia Option ARMs. 

An issue for many homeowners is managing income and expenses. Income varies and unplanned expenses come up. Our mortgage payment is our largest monthly expense, and least flexible. The Virginia Option ARM was designed to give you control over your mortgage payment. Choose one of four payment options each month based on your cash flow needs. Email Virginia Option Arms questions.

        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 maximizes cash flow and may also defer payment of interest on your mortgage 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 Virginia option arms. If you have concerns over deferred interest, more 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 Virginia Option ARMs statement as well.

The Option Arm series 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 Option ARM payment rates, there is a 5 year fixed payment option. With the 5 year Fixed Payment Mortgage, you have a fixed minimum payment for five years. You still have the four payment options to select from monthly to manage your cash flow. And, you have the ability to increase the term of your option arm from 30 to 40 years lowering your payment further.

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
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 Option Arm".

I have added a website dedicated solely to Option Arms.

Here is a useful Option Arm payment calculator

Read very important information about Virginia Option Arm 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 about this free, no obligation service.

     Virginia Option ArmsPrequalify for your Virginia Option ARMs

   Home Equity    Interest Only Mortgage  Investor Loans  Jumbo  Mortgage Links   Reverse Mortgage  No Down Payment Loan   Refinance Center   Site Map  Vacation Home Loans   Commercial Loans  Loan Modification Home

 

 

В©1998-2009


NEVER an Origination Fee!

Extensive consumer information on construction,remodeling, first time homebuyer,and no documentation mortgages.