Subprime hybrid mortgages offer temporarily low rates for borrowers while they work to rebuild their credit. With a sub-prime hybrid mortgage, you don?t have to pay PMI, saving hundreds a year. After two or three years of on time payments, you can then refinance for conventional mortgage rates.
Hybrid Mortgage Basics
Since so many people refinance their home loans after they have reestablished their credit, lenders created a mortgage to offer maximum flexibility for borrowers. Hybrid mortgages are typically 1.5% lower than a conventional loan for the first two or three years, depending on your mortgage terms. After that, the rated becomes adjustable, rising and falling based on indexes.
Lenders usually require a prepayment fee if the mortgage is paid off View the rest of this article
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