Hybrid Loans
- US
Information &
Advice on Hybrid Mortgage Loans. What is a Hybrid
Loan? Is a Hybrid Loan the Right Choice For Me?
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the box on the left for instant quotes.
Hybrid loans
are a combination of fixed rate and Adjustable Rate
Mortgage (ARM) loans. These ARMs attach a delayed
adjustment period during which the initial period is
fixed.
Hybrid mortgage loans carry
less risk than one-year
ARMs and
the interest rate is generally lower than fixed-rate
loans.
Since many homeowners remain in
their homes for about seven to10 years, combination
loans allow home buyers to take advantage of lower
interest rates in the first few years of the
mortgage.
Benefits
of Hybrid Mortgage Loans
- Hybrid mortgage loans
give the homeowner a lower rate than fixed-rate
loans and lower risk than the one-year ARMs.
- Many consumers select hybrids
mortgage loans when they know they will be in
the home for a select period of time.
- Homeowners use Hybrid
loans to lower their rate and to qualify for
larger loan amounts.
- Hybrids and ARMs are
generally assumable, which is a plus when
homeowners plan to sell in the near future.
-
Adjustable
rate mortgage rates can decrease in
declining interest rate markets reducing your
loan payment.
Disadvantages
of Hybrid Mortgage Loans
- Hybrid mortgage rates
are typically higher than one-year ARMs.
- Rates will adjust at the end
of the initial period, which could raise your
payment.
- Interest rates will adjust
annually after the initial period making it hard
to plan your finances. monthly payment can
increase significantly after the initial
fixed-rate period
There are a
number of companies who offer competitive Hybrid
Mortgage Loans. Use one of our free
Mortgage
Calculators to compare different Hybrid Mortgage
Loans.
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