Types of Financing
There are many types of financing the team at Cambridge Mortgage, Inc. can help you secure. Our team works closely with you to identify the ideal mortgage for your current financial situation and your long-term financial goals. Whether you are a first-time homebuyer or making the move into a larger home in Tennessee, we will help you determine the right mortgage for your lifestyle and financial future.
Choosing the Right Mortgage
Choosing the right mortgage requires consideration of your credit score, assets, income, and long-term financial goals. We help you understand how each of these factors affect your interest rates and payments. We also consider trends in the Tennessee real estate market and regional economy when helping you make your decision. Ultimately, our goal is to help you select a mortgage that does more than fit within your budget; we help you choose a mortgage that correlates with your long-term financial strategy.
Contact Cambridge Mortgage, Inc. to discuss your home ownership goals. Our mortgage professionals will answer your questions and help you determine the loan options that are best suited for your needs.
Fixed Rate Mortgages
Fixed rate loans are the most popular mortgage choice in Tennessee. The fixed rate translates to predictable mortgage payments spread over the course of 15, 20, or 30 years. This makes it possible for homeowners to plan ahead and know precisely what their payments will be over the long-term.
30-Year Mortgages are the most popular choice because they typically offer lower monthly payments which makes it possible to purchase a larger home without having to stretch the monthly budget. According to Freddie Mac, approximately 90% of home mortgages are 30-year fixed rate loans
20-Year Mortgages are the next most popular mortgage option. The payments on these loans typically falls between those of the 15 and 30-year fixed, and the interest rates are slightly lower than those for the 30-year fixed. This lets you essentially split the difference between a longer term loan with a higher interest rate and a smaller payment, and a shorter term loan with a lower interest rate and a larger payment.
15-Year Mortgages are becoming increasingly popular. While they do have higher monthly payment requirements, the interest rates are typically much lower. As a result, more of your monthly payment goes towards principal which reduces your overall interest burden. Depending on your budget, you may end up buying less house, but you will end up owning it much sooner which can brighten your long-term financial picture.
Contact Cambridge Mortgage, Inc. to discuss the advantages of 15, 20, and 30-year fixed rate mortgages. Our mortgage professionals will go over current interest rates and loan terms so that you know which loan is most suitable for your financial objectives.
Adjustable Rate Mortgages
Adjustable Rate Mortgages, or ARMs allow you to purchase a home with an interest rate that may change over time. These rates float on the index rate. If the index rate goes up, your monthly payment will rise. Conversely, if it goes down, your payment will decrease without the need to refinance the property.
Variable Rate loans adjust at set intervals throughout the life of the mortgage. These intervals are either every six months or once per year. These loans have a maximum capped interest rate. If you expect the interest rate to decrease in the future, these loans can save you a considerable amount of money over the long-term.
Hybrid ARMs offer a fixed rate for a specified period of time. These periods are typically 3 or 5 years. Once this period elapses, the interest rate is adjusted to reflect the rate at the time the period elapses. Hybrid loans are the most popular ARMs and many offer terms that allow you to refinance the loan at the interval period. In fact, it is common for people to refinance into a 15, 20, or 30-year fixed rate mortgage when the initial period expires.
Option ARMs offer you multiple repayment options. You can choose to make a monthly minimum payment, pay only the interest, or apply your resources to a 15 or 30-year amortizing payment. This type of loan can allow you to purchase a home that would be out of your price range with other types of mortgage options.
Contact Cambridge Mortgage, Inc. to discuss the various types of Adjustable Rate Mortgages we offer. Our team will help you understand your options and the terms associated with each loan. We will also discuss our long-term market analysis so that you can determine how best to use an ARM to reach your financial goals.
A ballon mortgage is a loan with a term that is usually 10 years long. However, these periods can range from 2 to 30 years. Most balloon mortgages require you to make an interest only payment each month. At the end of the loan term, you are required to pay off the balance in full. Balloon mortgages can offer fixed or variable rates, and most allow you to repay the loan early without penalty.
Contact Cambridge Mortgage, Inc. to discuss the advantages a balloon mortgage offers. Our lending specialists will help you understand trends in the real estate market and whether this loan option is suitable for your long-term financial objectives.
Government Backed Loan Programs
Home ownership is a ladder to wealth. Home ownership improves property values and creates strong communities in Tennessee. That is why the federal government backs a wide range of loans that make it possible for you to purchase a home and enjoy the rewards that owning a home can bring.
FHA Loans are designed to help first-time homebuyers, and those with minimal credit or bad credit, purchase a home. These loans are available to individuals with credit scores as low as 580 who havea debt-to-income ratio of 43% or less. These loans require a 3.5% down payment.
VA Loans are available to soldiers, sailors, and airmen who serve on active duty, in the reserves, or as part of a National Guard unit. These loans do not have stringent qualification requirements and they are transferable to qualified buyers.
Indian Home Loan Guarantee loans are available to Cherokee, Chickasaw, Muskogee, Natchez, and other tribes in Tennessee. These fixed rate loans make it possible for low-income borrowers to purchase a home equal to 150% of the FHA lending limit for Tennessee.
Great Choice Home Loan Program is available for first-time homebuyers in Tennessee. These 30-year fixed rate home loans allow homebuyers to finance up to 96.5% of the home purchase price.
Contact Cambridge Mortgage, Inc. to learn more about government backed mortgage programs. Our team will help you understand the qualification requirements for each program and help you determine which is the best option for your needs. When you are ready to complete the application, we will guide you through the process and make sure that your paperwork is organized and ready to go.