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Types of Loans

Thirty-Year Fixed Rate Mortgage
The traditional 30-year fixed-rate mortgage has a constant interest rate and monthly payments that never change. This may be a good choice if you plan to stay in your home for seven years or longer. If you plan to move within seven years, then adjustable-rate loans are usually cheaper. As a rule of thumb, it may be harder to qualify for fixed-rate loans than for adjustable rate loans. When interest rates are low, fixed-rate loans are generally not that much more expensive than adjustable-rate mortgages and may be a better deal in the long run, because you can lock in the rate for the life of your loan.

Fifteen-Year Fixed Rate Mortgage
This loan is fully amortized over a 15-year period and features constant monthly payments. It offers all the advantages of the 30-year loan, plus a lower interest rate—and you'll own your home twice as fast. The disadvantage is that, with a 15-year loan, you commit to a higher monthly payment. Many borrowers opt for a 30-year fixed-rate loan and voluntarily make larger payments that will pay off their loan in 15 years. This approach is often safer than committing to a higher monthly payment, since the difference in interest rates isn't that great.

Adjustable Rate Mortgages (ARM)
When it comes to ARMs there's a basic rule to remember...the longer you ask the lender to charge you a specific rate, the more expensive the loan.

Hybrid ARM (3/1 ARM, 5/1 ARM, 7/1 ARM)
These increasingly popular ARMS—also called 3/1, 5/1 or 7/1—can offer the best of both worlds: lower interest rates (like ARMs) and a fixed payment for a longer period of time than most adjustable rate loans. For example, a "5/1 loan" has a fixed monthly payment and interest for the first five years and then turns into a traditional adjustable-rate loan, based on then-current rates for the remaining 25 years. It's a good choice for people who expect to move (or refinance) before or shortly after the adjustment occurs.

2/1 Buy Down Mortgage
The 2/1 Buy-Down Mortgage allows the borrower to qualify at below market rates so they can borrow more. The initial starting interest rate increases by 1% at the end of the first year and adjusts again by another 1% at the end of the second year. It then remains at a fixed interest rate for the remainder of the loan term. Borrowers often refinance at the end of the second year to obtain the best long-term rates. However, keeping the loan in place even for three full years or more will keep their average interest rate in line with the original market conditions.

FHA Loans                                                                                                                                                   The Federal Housing Administration (FHA) the largest mortgage insurer in the world, as well as regulates housing industry business.  An FHA loan will allow the borrower to obtain a mortgage with only 3.500% downpayment and the loan will have FHA insurance to cover the lenders.   

VA Loans                                                                                                                                                      VA helps Servicemembers, Veterans, and eligible surviving spouses become homeowners. The VA will provide a home loan guaranty benefit and other housing-related programs to help you buy  a home for your own personal occupancy.

THDA Loans                                                                                                                                               THDA was created to promote the production of more affordable new housing units for very low, low and moderate income individuals and families in the state. THDA loans have 30-year, fixed-rate terms and offer a maximum grant of 5% in down-payment assistance. All homebuyers receiving down-payment assistance must complete a homebuyer education course.

USDA Loans                                                                                                                                              USDA’s Single Family Housing Programs provide direct loans or loan guarantees to help low- and moderate-income rural Americans buy safe, affordable housing in rural areas. Eligible applicants may buy a dwelling in an eligible rural area. The program provides a 90% loan note guarantee to approved lenders in order to reduce the risk of extending 100% loans to eligible rural homebuyers.

 

 

 

 

 

 


 

 

 

Franklin Synergy Bank NMLS#556334
722 Columbia Ave, Franklin, TN  37064
Direct:  (615) 564-6400
Toll Free:  (866) 834-4838
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