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Fixed Rate Mortgage
A mortgage loan in which the interest rate remains fixed throughout the life of the loan. A Fixed Rate Mortgage offers the borrower the benefit of fixed monthly payments with no exposure to any change in interest rates in the market. Fixed Rate Mortgages are the most common form of mortgage loans.
- 30 Year Fixed: A fixed interest rate loan with an amortization term of 30 years, or 360 months
- 20 Year Fixed: A fixed interest rate loan with an amortization term of 20 years, or 240 months
- 15 Year Fixed: A fixed interest rate loan with an amortization term of 15 years, or 180 months
- 10 Year Fixed: A fixed interest rate loan with an amortization term of 10 years, or 120 months
Non-Conforming / Jumbo Loans
A mortgage loan with loan amounts above the conforming loan limits set by FHFA and/or the underwriting guidelines established by Fannie Mae or Freddie Mac. Each conforming loan limit varies by county in every state. SunnyHill Financial can offer both Fixed Rate and ARMs for Jumbo loans.
A mortgage loan that is guaranteed or insured by an agency of the federal or state government such as VA or FHA. Since the government protects against the borrower defaulting, this allows the lender to offer loans to the borrower at a lower interest rate. These programs are almost always a 30 year fixed rate.
Adjustable Rate Mortgage (ARM)
A mortgage loan in which the interest rate adjusts periodically based upon the movements of a pre-determined index or reference rate, most commonly the LIBOR. There is a set fixed rate period for the loan, and once that period is over the loan can adjust with the changes in the index rate. The borrower may then see periodically changing monthly payments.
- 10/1 ARM: Rate is fixed for 10 years, then adjusting once per year starting in year 11
- 7/1 ARM: Rate is fixed for 7 years, then adjusting once per year starting in year 8
- 5/1 ARM: Rate is fixed for 5 years, then adjusting once per year in year 6