The Programs:
The 3,5,7 or 10 year interest only loans have a 30 year term. They have a fixed interest rate for the first 3,5,7 or 10 years, during which time you are only obligated to pay the interest payment of the loan and not the principle. The interest rate is fixed during this first 3,5,7 or 10 year term. You can however pay any amount of principle payment towards your loan balance, at any time during the 3,5,7 or 10 year period. There is no negative amortization on this loan. Your loan balance does not increase during the term of the loan. The balance of the loan term up to 30 years, requires a principle and interest payment at the current interest rate at that time.

Interest only mortgage loans are currently in strong demand due to the lower required monthly payments.

Features:

• You can borrow up to 100% loan to value of your property.
• No cash reserves required. (No cash in the bank is required).
• Full Document (Supplying income documents for previous 2 years) or Stated Income (Simply stating your income with no back up documentation supplied) is an option for these loans.
• No Documentation is also an option for these loans.
• Condominiums are OK.
• Purchases or refinances with cash-out is permitted.
• These loans are available for most credit grades.
• Interest Only programs are also available for first time home buyers.
• At least one of the borrowers on the loan should have a minimum of 3 open credit lines, each with a $500 or more balance, that have been paid regularly for the previous 24 months.(Example: a car payment, credit cards, department stores accounts, etc.) Copies of three months previous bank statements, savings accounts, Ira’s and 401k’s are required.
• A debt ratio of not more than 45% is acceptable for this loan. (This means all the borrowers can total their gross stated monthly income, before tax, and allocate up to 45% of that income against mortgage payments, plus all monthly consumer debt payments not being paid off with the loan, and monthly payments of property tax & insurance.)
• Borrowers with credit scores over “680” and the loan amount required will determine the interest rate charged and the loan costs, if any, to be charged on the loan.
• All closing costs, if any, are financed in the loan.
• We can loan up to 100% of the value of your property.

Provided:

• You have had no bankruptcies or property foreclosures in the previous 24 months.
• You have had a job or were self employed for the previous 2 years.
• You have no unpaid tax or other liens at closing.

Principle - The original loan amount that is borrowed.
Interest Rate - The service fee charged to you monthly, by the lender, for advancing you money. The interest rate percentage (%) determines how much or how little the Lender will charge for advancing you the money.
Margin - The difference between the Interest rate that Banks pay for their money when they borrow it and the Interest rate that they charge you when they in turn lend it to you is their Profit. In Banking terms however, they don't use the word Profit, they call it the Margin.
Index - The Base Index is the average base Interest Rate. The banks or lenders must pay for their money when they borrow (take in) money for lending. There are a number of different indexes used The Bank will specify both up front and in the loan documents which Index they are using. The three most widely used Indexes are the:

• LIBOR: The advertised interest rate of the 1 Year London Interbank Offered Rate. This is the rate at which US deposits of Dollars are traded in London.
• COFI: The advertised interest rate of the 11th District Cost of Funds Index. This is the average rate that the other 11 Banking Districts of the USA, pay for money deposited with them.
• MTA: The advertised interest rate of the 12 Month Treasury Average . This is the 12 month average interest paid on United Stated Treasury Securities traded, with a one year maturity.
• When Banks lend out their money (to you) on any ADJUSTABLE RATE MORTGAGE, they add the Margin (the Profit they want to make) to the Index (What they pay for their money from either the LIBOR the COFI or the MTA .) This determines the full Interest Rate that they, in turn will charge you.
• The Margin rate is fixed right upfront for the life of the loan.
• The Index rate can fluctuate from time to time.
• The Indexes used in the mortgage industry are widely published.