When borrowing from the equity in your property, you have the option to Choose between a home equity loan and a home equity line of credit. They differ in the interest rate being offered and in the way you access your funds. Home equity loans are fixed-rate loans, while home equity lines of credit have a variable rate.
Home equity loan, a fixed rate option
The fixed home equity loan traditionally has a higher rate than the home equity line of credit. Your payment will remain the same over the life of the loan regardless of the change in the market rate especially if they rise above your rate. This loan is an excellent option if you live on a monthly budget or you are looking for payment stability.
Home equity line of credit, a variable rate option
This line of credit offers a lower rate than the fixed home equity loan. It is a variable rate product. The rate changes periodically according to the changes of the financial index such as The Wall Street Journal Prime Rate. The interest rate is determined by adding the rate of the index, which can vary over time, to a margin, determined by Arrha Credit Union which remains fixed for the life of the line of credit. If the index goes up so will your interest rate and payment and if the index goes down, so will your rate and payment also decrease.
Arrha Credit Union offers a variety of fixed rate mortgages beginning with a term of 5 years up to 30 years. These programs allow you the security of a fixed interest rate of the monthly principal and interest for the entire life of the mortgage.
Variable rate mortgages are offered for specific situations, and those individuals who are uncomfortable with their payment going up or down during the term of the mortgage.
Jumbo mortgages are offered by Arrha Credit Union for mortgage loans in excess of Freddie Mac, Fannie Mae and federal Home Loan Bank guidelines of a maximum mortgage loan of $424,100.00. up to $600,000.00.
Massachusetts Housing Partnership – ONE Mortgage Program
Arrha offers the ONE Mortgage to low- and moderate-income first-time homebuyers. A down payment of 3% or more is required, but Private Mortgage Insurance is not.
- Property and casualty insurance required
- Flood insurance required if property is in a flood zone
To learn more about the benefits of the ONE Mortgage or to apply, contact:
Tony Sanches, NMLS #476943, (413) 732-9812, TSanches@arrhacu.com
Ana Frasco, NMLS #905740, (413) 732-9812, AFrasco@arrhacu.com
FHA loans offer lower down payments and are a good option for first-time homebuyers. The loans are insured through the Federal Housing Administration (FHA), which is part of the U.S. Department of Housing and Urban Development.
Loans through the U.S. Department of Agriculture (USDA) can help rural homebuyers achieve their dreams of owning their home! USDA loans are also not limited to first-time homebuyers.
VA loans, through the U.S. Department of Veterans Affairs (VA), help Service members, Veterans, and eligible surviving spouses become homeowners. Certain eligibility requirements apply.
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