Loans

Many kinds of loans have been designed to help match a given financial situation to a loan product that is most advantageous to a specific person or family.

Fixed Rates: These loans guarantee what your interest rate will always be. For example, your loan may say that your interest rate is 6.25% for the life of the loan.

Fixed Time Periods: These loans allow you to know exactly how long the terms of the loan will continue. Many people prefer the traditional approach and chose a 30-year time period.

Variable Rates often called ARMs (Adjustable Rate Mortgages): These loans start at one rate and then, after an agreed upon time period, may go up or down depending on a well-known, specific index, such as the interest rate on a one-year Treasury Note. These kinds of loans use the known interest rate and add to it a margin to determine your actual new rate. So if the Treasury Note is at 3.5% and your margin is 2.25%, your rate will be 5.75%. If the Treasury Note interest goes up, your interest rate goes up. If the Treasury rate goes down, your interest rate goes down. ARMs are usually fixed for the first part of the term of the loan, such at one year or five years before they change.

Home Equity Lines of Credit (HELOC): These loans allow you to borrow the equity in your home with the ease of writing a check. Many lenders simply give you a checkbook or even a credit card and a limit as to the amount you can borrow. These kinds of loans are very useful for short-term financial needs, such as paying taxes or buying a car. They can also be a good choice for many people instead of using a regular second mortgage. Interest paid on these loans change according to an agreed upon index, such as the prime rate, therefore, your interest rate could go up or down. Interest on these loans, like all home loans, may be tax deductible, a strong attraction as opposed to the interest on a credit card or car loan, which is usually not deductible.

No Doc or Low Doc: Many lenders will look at your credit score alone and make a determination that you are a good risk. There can be a cost associated with limited or no doc loans, but the advantages can often outweigh these costs.

What Type of Loan is Right for Me? No cost versus low cost? We all know there is no such thing as getting something for free. Even when you don’t see the cost, it is built in. ATM is up front about all costs associated with your loan package – nothing is hidden. A point is one-percent of your loan. If your loan is for $150,000, one point is $1,500. At ATM we practice responsible lending. We spend a lot of time taking people out of loans they should never have been put in. We are not selling you a loan; we are selling you a long-term result.

Of course there are many more kinds of loans and mortgage products, such as reverse mortgages, hard money loans, negative amortization (neg-am) products, seller carry-back financing and many combinations of these. The job of choosing the best product for each person is a demanding specialty. New products come on line often and your financial situation changes too, so what was best for you last month may not be your best choice this month.