Rock Construction and Management

310.493.3014

DRE License #: 01291112
CSLB License #: 753939

FINANCING

Mortgages and Home Loans:

There are many home loan options, and there is a different loan for every budget and need.

Fixed Rate Mortgages:

If you are looking for a long term loan, your best bet is to get a fixed-rate loan.  With a fixed-rate mortgage you will always know what your payments will be and it gives you the option to refinance if and when rates drop significantly.

Adjustable Rate Mortgages:

There are also Adjustable-Rate Mortgages (ARM’s).  The interest rates of an ARM mortgage fluctuates within an indexed rate plus a set margin.  These loans also offer minimum and maximum rate caps which will limit the size of the adjustment. Adjustable-rate mortgages offer a lower rate than fixed-rate mortgage.  ARM’s are most beneficial to the homeowner who is expecting to stay in a home for a shorter period like less than 5 years.  You can also qualify for a larger loan with an Adjustable-rate mortgage.  Keep in mind that these rates will often increase after the adjustment period.

Federal Housing Administration Loans:

Loans from the Federal Housing Administration (FHA) are government-subsidized and have low down payments with closing fees included.  The government guarantees the loan.  FHA loans are favorable for those who are first time buyers.

Fixed-rate mortgages, Adjustable-rate mortgages, and Federal Housing Administration loans are the three most common loans.  There are other forms of loans including loans for veterans, reverse mortgages, balloon mortgages, and other conforming and non-conforming loans.  The right agent with the right team will get a good sense of your needs and will help you through the process of purchasing your home.


Getting the Best Rates for Your Mortgage

Naturally, you want to get the best deal for the least amount of money.  This holds true for mortgage rates as well. A lower interest rate means a lower monthly mortgage payment, which can save you money in the long run.  Also, it is easier to qualify for a lower payment than a higher one.

You basically have two routes to finding the best rate.  The first is to do all the research on your own.  The second is to use a mortgage broker.


Do-It-Yourself

With the advent of the Internet, much of this information is readily available online. Once you have educated yourself sufficiently about real estate loans, all it takes is the time and energy to sift through online resources to find the information you need.

Rates change quickly.  That great rate you find today might not be there tomorrow. Once you find the rate you are looking for, submit a loan application and lock in that rate.

Some sources for interest rates on the Internet include:

Bank Rate Monitor
E-Loan
Own.com

When comparing loans, make sure that you're comparing loans of the same type.  For example, you find that "Loan A" for a 30-year loan has a much lower interest rate than "Loan B" (also for 30 years).  Upon further inspection, you find that "Loan A" is technically an adjustable rate mortgage.  Its payment is based on a 30-year amortization, but becomes due through either payment or refinancing at the end of 5 or 7 years.  These are frequently referred to as a 5-year or 7-year fixed-rate mortgage. While both said "30-year", they are not the same type of loan.

Ask the lender for a statement detailing all fees associated with the loan.  Factors such as "points" (loan fee), interest rate and "garbage fees" (extra fees which some lenders charge) can vary greatly from one lender to another.

Mortgage Broker

If you do not have the time or experience to "do it yourself", look for a qualified mortgage broker that can assist in finding the right mortgage for you.  Ask friends and associates who have refinanced or purchased recently if they have a broker they can recommend.  You'll want to find a broker who is energetic, flexible and knowledgeable about finance and loans and someone who has your best interests in mind.