Real Estate Tips and Trends… The 15-Year Mortgage Rate Switch
The Wall Street Journal (5.30.2014) reported on new mortgage offers to borrowers, namely a single rate change of 15 years into a 30-year loan.
Mortgage borrowers usually have to decide between low rates or a long term. Pentagon Federal Credit (PenFed) in Alexandria, VA says you can have it both. PenFed officials say their product, introduced in February, is designed to appeal to borrowers who are looking to refinance or purchase a second home.
While locking into a long-term rate is attractive, there can be a downside because rates could jump later. It’s a calculated risk. Here are some issues for jumbo-loan customers to consider:
* Note Restrictions: Credit unions have membership rules in their charter and not everyone can join every credit union. Restrictions may be based on a variety of factors including an applicant’s employer or geography.
* Beyond Rates: As with other mortgage applications, borrowers must consider settlement and origination fees and other out-of-pocket expenses.
Think Ahead: Make sure you ask the right questions and look at other options. Some credit unions will keep their loans, others may sell them meaning you’ll be dealing with a different loan servicer than the original credit union