Mortgage Basics: Information for First Time Home Buyers

Choosing the Best Loan

There are no bad or perfect loan programs out there, but there are loan programs which are right for your needs and those that aren't. Which loan program is best for you depends on a number of factors, such as how long you are planning on keeping the loan before you move or refinance, the current interest rates as well as the forecast for future rates, and your personal situation. For instance, many people are afraid of the idea of an adjustable rate mortgage, but they typically have lower rates than fixed mortgages and are sometimes a better deal if you are planning on moving or refinancing within a few years. Their value also depends on current rates, what the rates are likely to do in the future as well as the index rate adjustments are based on, how often it adjusts and the adjustment cap (or how much the rate can change within a given increment of time). However, an ARM would probably not be a good idea if you are planning on living in the same house for the life of your loan and have no desire to refinance later. That is just one example, your mortgage broker should be able and willing to discuss the value of any particular loan program for your situation and needs. If you have any questions about the different types of loan programs available, you might want to check out our loan programs page which outlines some of the advantages and disadvantages of several common loan programs. You can also visit our "Contact Us" page for information about how to contact us, if you would like to talk with us about a particular loan program.