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Our Option ARMs offer you the most flexibility when qualifying for a loan, then put you in control of your finances when you start making payments. Manage your money the way you want with up to four payment options each month:

Minimum payment: The smallest payment to let you keep the most cash now.

Choose this option to let you keep more cash now and keep monthly payments manageable. Generally, this payment changes annually and is calculated using the initial interest rate for the first 12 months. After that, the minimum payment is usually recalculated based on the outstanding principal balance, remaining loan term and prevailing interest rate.

A payment cap limits how much this payment can increase or decrease each year.

Interest rate adjustment feature and payment change cap, and certain payment options, can result in deferred interest. In the event your principal balance otherwise would increase to 125% (110% in NY) of your original loan amount, we will adjust your minimum payment amount immediately. This means that the minimum payment amount may increase more frequently than annually, including before the end of the initial 5-year period (or before the end of the initial 10-year period for the Fixed-Pay 120), and payment changes will not be limited by the 7.5% payment change cap.

Interest-only payment: Keep payments manageable while paying all your interest.

At those times when the Minimum Payment is not enough to pay the monthly interest due, you can avoid deferred interest with this option. You pay the minimum monthly payment and all additional interest accrued during the month. So you avoid deferred interest, and your payments are still manageable.

Note: This option does not result in principal reduction.

Fully amortized payment: Reduce your principal and pay off your loan on schedule.

It's calculated each month based on the prior month's interest rate, loan balance and remaining loan term. When you choose this option, you reduce your principal and pay off your loan on schedule.

15-year payment: Own your home twice as fast.

If you want to build equity faster, pay off your loan quicker and save on interest, this is the option for you. It's calculated to amortize your loan based on a 15-year term from the first payment due date.

Flex Home Loans
Flex 3 and Flex 5 Home Loans offer you the best of both worlds -- a fixed initial rate and payment combined with the flexibility of our popular Option ARM. Flex Home Loans have flexible qualifying guidelines so that you can afford a more valuable house. You'll get payment options after fixed rate periods of 3 or 5 years and portfolio features tailored to meet your needs.

Advantages

* Lower initial interest rate than fixed-rate mortgages
* Low minimum payment that adjusts annually
* 7.5% limit on payment increases or decreases
* Lifetime interest rate cap that protects you financially
* Up to 40-year terms available to help minimize your payments

Consider an Option ARM If:

* You want to minimize your house payment to pay off other debt.
* You want to control the amount of tax-deductible interest you pay each month.
* You want to maximize your buying power.
* Your income tends to fluctuate or you're confident that your income will rise over the    years.

Variations

* 15, 30, and 40 Year Terms
* 1, 3, and 6 month options: initial 1, 3, or 6 month fixed interest period, then adjusts     monthly. Payment amount fixed for a year then adjusts annually.
* Flex 3 and Flex 5: fixed interest rate and payment for 36 and 60 months, then converts to    monthly adjustable Option ARM with annual payment change.

* Example(1): $200,000:
	o Minimum Payment of 1.00% = $643.27/mo o Interest Only = $791.11/mo o 30 Year Term = 974.00/mo (P/I) o 15 Year Term = $1,497.00/mo (P/I)
* Example(2): $500,000:
	o Minimum Payment of 1.00%= $1608.00/mo o Interest Only = $1,978/mo o 30 Year Term = $2,437.00/mo (P/I) o 15 Year Term = $3,742.00/mo (P/I)
* Example(3): $1,500,000:
	o Minimum Payment of 1.00% = $4825.00/mo o Interest Only = $5,934.00/mo o 30 Year Term = $7,312.00/mo (P/I) o 15 Year Term = $11,225.00/mo (P/I)

 

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