• Monthly payments are fixed over the life of the loan
• Interest rate does not change
• Protected if rates go up
• Can refinance if rates go down

• Higher interest rate
• Higher mortgage payment
• Rate does not drop if interest rates improve

• Lower initial monthly payment
• Lower payment over a shorter period of time
• Rates and payments may go down if rates improve
• May qualify for higher loan amounts

• More risk
• Payments may change over time
• Potential for high payments if rates go up

• Lower initial monthly payment
• Lower payment over a shorter period of time
• Many balloon mortgages offer the option to convert to a new loan after the initial term.

• Risk of rates being higher at the end of the initial fixed period
• Risk of foreclosure if you cannot make balloon payment or if you cannot refinance or if you cannot exercise the conversion option

• Lower down payment
• Easier to qualify
• Sometimes you may get lower rates

• May be subject to income and property value limitations
• Some programs which have government subsidies may be have a recapture tax if you sell the house too early.

• Don't need to verify income
• Faster approval

• Higher rates
• Higher down payment

• No closing costs
• Less mibet required to close

• Higher rates
• Higher payments

• Potential for reestablishing credit if you pay your mortgage on time
• When used for debt consolidation, you may be able to reduce your monthly debt payment

• Higher rates
• Terms may not be as favorable
• Harder to get long term fixed loans
• Loans may have prepayment penalties

• You only borrow what you need
• Pay interest only on what you borrow
• Flexible access to funds
• Interest may be tax deductible

• Higher interest rates than on 1st mortgages
• Harder to refinance your first mortgage

(A) The Teacher Homebuyer Program (100% Financing) is specifically designed for the K-12 Teachers in San Jose. When the requirements have been met, the teacher is eligible to apply for the teacher program from the City of San Jose and the Department of Housing, where they will provide loan assistance, up to $40,000, 0% interest and not due and payable until transfer of title to the home or in 30 years. The maximum loan amount is $252,700 + $40,000, with a sales price of $292,700.

(B) STRS Zero-Down Preferred Program (100% Financing) has expanded its features and added a new zero-down feature to its Home Loan Program. The program is targeted to the K-12 Teachers and College Instructors (part-time or full-time). One simply has to participate in the STRS retirement program to be eligible.

The program combines the traditional 95 percent loan-to-value with the secondary financing provided by CalSTRS equal to 5 percent of the purchase price of the home. The beauty of this program is that the interest rate on the second mortgage will be same as the first mortgage. When certain restrictions are met, one can apply for a loan amount of up to $350,000.

If one wishes for a higher loan amount at 0% down payment, please call to find out how you can qualify.

From more information on the Teacher Home Buyer Program, please call Mary Shoane, (408)723-2020, ext.4.

• Purchase a house with 0 down
• Piggyback loans 80-10-10 or 80-15-5. No PMI payments even 5% or 10% down.
• Debt consolidation programs
• Home Improvement loans
• Qualify even if you may have been turned down before!