Option ARM Program Highlights
Programs
Option ARM Program Highlights - Hybrid ARMS - Flex 3 and Flex 5
| Features | Hybrid ARMS - Flex 3 and Flex 5 |
|---|---|
| Available Indices | 12-MTA |
| Available Products | Flex 3 and Flex 5 (Full and Low Doc) |
| Initial Fixed Interest Period | 3 or 5 years |
| Product Type | Intermediate Option ARM |
| Term | 15-, 30- and 40-year term |
| Maximum Loan Amount | $2,500,000 |
| Initial Fixed Payment Period | 3 or 5 years (depending on product) |
| Interest Rate Adjustment Frequency | Monthly after initial fixed interest period |
| Payment Adjustment Frequency | Annually from the first payment date |
| Payment Change Cap | 7.5% maximum cap increase or decrease, except as defined in recast parameters below, without regard to payment cap |
| Potential Deferred Interest | Yes, after initial 3- or 5-year fixed period |
| Recast | Flex 3: Fifth year and every five years
thereafter; Flex 5: Tenth year and every five years thereafter. In both cases, immediately if the negative limit exceeds 125% (110% in NY). |
| Payment Options | After the initial period, borrowers may have up to four payment options: |
| 1. Minimum Payment Due (may result in deferred interest) | |
| 2. Interest Only* | |
| 3. Full Principal and Interest Payment (based on the remaining term of the loan)* | |
| 4. Full Principal and Interest Payment (based on a 15-year term)* | |
| *will not be offered if the payment is less than the minimum payment due | |
| Advantage 90 | Available on loans of 80.01% to 89.9% LTV with no MI. Not available on Sub-Prime |
| Assumability | Yes, subject to an assumption fee and certain conditions |
| Eligible Properties | -1-4 units |
| -Condos and PUDs | |
| -Detached SFR only on loans >$1M | |
| -1-unit co-op (NY only) | |
| Occupancy | -Owner Occupied |
| -Non-owner-occupied | |
| -Second home | |
| Loan Purpose | -Purchase |
| -Cash-out refinance | |
| -No cash-out refinance | |
| MI Coverage Requirements | Borrower paid monthly is required for all loans with an LTV greater than or equal to 90%, and is available for loans greater than 80%. MI is not available in NY on potential deferred interest ARMs greater than 80%. |
| Uninsured Sub-Prime (greater than 80.0% to 89.9%) | |
| Secondary/Subordinate Financing | Available. See Product and Pricing Guide for eligibility and maximums. |
| Qualifying Rate | Note rate |
- Option ARM - Optional Payment Adjustable Rate Mortgage - Overview
- Option ARMs The Loan Banks Wish They Had Opted Not to Do
- Option ARM - 1 Month Option Adjustable Rate Mortgage
- Option ARM Program Highlights and Guidelines 1-, 3-, 6- and 12-Month Option ARMS
- Option ARM Program Highlights - Hybrid ARMS - Flex 3 and Flex 5
- Click here for Current Mortgage Rates