An interest-only loan has become a very
popular choice of the many Washington home loans that are available. What is making this type of loan so popular? What other options are available to potential
Washington home buyers.
If you have a desire for a lower initial
monthly payment, lower payments over shorter period of time, the possibility
that if rates improve your rates could go down giving you lower payments, the
fact you may qualify for even an even higher loan amount which would allow you
to purchase a larger house than originally you thought this may be an option
you should investigate. There are a
couple of other things you may need to consider. Your payments may change over time. There is also the potential for higher payments
if the rates go up. These interest only
loans are normally interest only for a specific period of time. The normal time is 4 to 11 years then the
payment is raised to a normal level.
This type of an option can be placed on any type of mortgage so you
still will need to plan carefully since it will resort back to the original
mortgage you have.
The best candidate for an interest-only
loan would be someone who could afford to pay for the home with a typical fixed-rate,
30-year mortgage. The reason they would
choose an interest only is it is part of a financial plan they have for the
Washington home loans are made available
thru several other programs. The Homeownership
Opportunity Initiative was created to make home financing more available and
easy for working families. They also
have the HomeSite program. This unique
program is based on need and provides the home owner opportunity to modest
income first time home buyers.
A bit about down payment assistance and
what it means. Most of the Washington
home loans have programs to assist with down payment issues. Many people believe this is free money, most
of the time it is not. Many of these
programs are actually a second mortgage that has low interest rates or deferred
payments. Now you may be able to qualify
for a Grant. This does not have to be
paid back. It is normally paid back if
you sell your home within a certain amount of time however. Most of these programs have income
restrictions. These normally require
buyers to be below 80% or at 80% of the Area Median Income to qualify.
So along with the normal loans such as a
standard 30 year mortgage Washington also allows the buy a choice of several
other programs to assist in getting the house of your dreams. It is suggested before deciding on any of the
Washington home loans, you develop a financial plan and speak to a mortgage
professional with any questions that you may have.