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Real Estate Tips
Financing Your Home >Mortgage Terms

New mortgage loan products offer a more complex selection of terms. Lenders now offer mortgages that are blends of short-term ARMs and 30-year fixed-rate loans with a lower fixed-rate of interest for a period of five, seven or ten years. Be sure that you understand what happens at the end of the initial term before you sign on the dotted line for such a loan.

Many of these loans revert to a 1-year adjustable rate loan at the end of the initial term and can be adjusted once a year based on an index tied to the cost of money. You should know how much over the index your rate will be set and the limit or cap on how much your payments can increase. A "balloon" note requires the entire balance to be paid to the lender after the initial period of the loan ends. Most of these loans require the lender to guarantee to refinance the note at that point if payments have been timely. The lender should spell out how the re-finance rate will be determined and what costs will be involved. These loans can help you buy a more expensive house than you could afford with a 30-year fixed rate mortgage, but be sure that you understand the terms and the potential risks.

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Real Estate Trivia
Q 
What real estate term was first used in the 19th century and means "a high-flying flag on a ship"?

A 
Skyscraper was first used in the 1880s when office buildings of 10 stories or more were built in Chicago and New York.
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Beth Jaworski, REALTOR®, real estate agent and broker for Milwaukee, Wauwatosa and Waukesha County, Wisconsin home listings, property and land for sale - NUMBER1EXPERT(tm)

Beth Jaworski
Shorewest Realtors

11622 W. North Avenue
Wauwatosa, WI. 53226
Phone: 414-520-8555
Fax: 262-782-1551
Email: sold@bethjaworski.com
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I have been a full-time residential Realtor since 1992 and have over $50 million in career sales. I know how to deal with the changing market and get you the best price, buying or selling. Email me today for a no obligation consultation.

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