Rudy Molinet, Broker/Owner
Marquis Properties Realty
933 Fleming Street
Key West, FL 33040
Direct: 305-240-1090
Fax: 305-768-0808
rudy@rudymolinet.com
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Below are two lenders we have worked with in the past. Feel free to contact them. We encourage you to interview several lenders to find the one who best meets your needs.
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Pat Labrada
Mortgage Loan Originator
FNMA, FHLMC, FHA and VA Approved
Centennial Bank
2514 N. Roosevelt Blvd.
Key West, FL 33040
Office: 305.676.3107
Cell: 305.304.7000
plabrada@my100bank.com
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Ani Madruga
Vice President
First State Bank of The Florida Keys
1201 Simonton St Street
Key West, FL 33040
305-293-7130
AniM@keysbank.com
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There are basically Three Types of Mortgages for you to consider. Each one has its advantages depending on your particular situation.
1. Fixed Rate Mortgages
Consider a fixed rate mortgage if either of the following
describes you:
- You plan on living in your new home
for many years, and/or
- You are not a risk-taker and prefer
the stability of knowing how much your payment will be each
month.
Since most home loans are for a period
of 30 years, if you want a payment you can count on for that
long of a period of time, a fixed rate mortgage may be what
works best for you. Once your loan amount and interest rate
are calculated and locked in, a fixed rate mortgage will guarantee
that you will have the same payment over the life of the loan.
Making extra payments to principal will allow you to pay your
loan off sooner.
This may not always be the best choice, however. If interest
rates are very high at the time you take out your loan, with
a fixed rate mortgage you'll be stuck with that high interest
for the life of the loan (unless you choose to refinance).
Conversely, if interest rates are very low, you'll come out
the winner with interest rates that will stay low no matter
how high interest rates go in the future.
The following are descriptions of the varying lengths and
terms of fixed-rate mortgages:
- 15-Year Fixed-Rate:
- You pay off the loan in half the
time of a 30-year loan.
- Equity builds up more quickly than
in a 30-year loan.
- Payments are higher (which
may be a problem if you lose your job or become unable to
work).
- 20-Year Fixed-Rate:
- You pay off the loan in 2/3 the
time of a 30-year loan.
- The overall interest paid is considerably
less than for a 30-year loan.
- 30-Year Fixed-Rate:
- The most common choice, especially
for first-time homebuyers, as it's the easiest of the fixed-rate
loans to qualify for.
- Monthly payments are lower than for
15-year and 20-year loans. This can prove especially helpful
if you don't have a lot of "padding" between the
amount you can afford to spend & the monthly payment
for your desired property.
- More desirable if you plan on staying
in the same home for years, since equity builds more slowly
than for shorter-term loans.
- For income tax purposes, this term
provides the maximum interest deduction.
2. Adjustable-Rate Mortgages (ARMs)
If you are more comfortable in taking a risk with your money
or if interest rates are very high at the time you take out
your loan, an adjustable-rate mortgage (ARM) may be the solution
for you. You might also choose this type of loan if your planned
ownership of the property is short-term or if you expect your
income to increase to cover any potential rise in the interest
rate.
Generally, the interest rate when you take out your loan will
be lower than a fixed-rate mortgage. Please note that this
is true initially, not
necessarily long-term.
Since an ARM rate rises and falls depending on the prevailing
interest rate, your mortgage payment will rise and fall accordingly.
If your income isn't sufficient to cover the highest possible
payments, then this option isn't for you. On the positive
side, the lower initial payments will allow you to qualify
for a larger loan than if you choose a fixed-rate. The downside
is that your payments will increase if/when the rates go up.
Typically, ARM interest rates are tied to a specific financial
index (such as Certificate of Deposit index, Treasury or T-Bill
rate, Cost of Funds-Indexed Arms or COFi, or LIBOR [London
Interbank Offered Rate]) and your payment will be based on
the index your lender uses plus a margin, generally of two
to three points. Get the formula used by your lender in writing
and make sure you understand what it means.
Fortunately, the amount an ARM can increase is not unlimited.
There are "caps" on how much your lender can increase
your rate, both for a period of one year and for the life
of the loan. Plan ahead, and have your lender calculate what
the maximum payment would be if your rate went to the highest
amount allowed by the cap for your particular mortgage. If
you're not confident you'll be able to pay that amount on
a monthly basis, perhaps you should reconsider this type of
loan.
3. FHA and VA Government Loans
Another mortgage option available to some people is a government
loan, providing that you meet the qualifications for these
loans.
- VA Loans: Veterans
may qualify for a loan from the Veterans
Administration. There is a limit on the amount you can borrow,
so this option works best for those buying a lower priced
home.
-
FHA Loans:
The Federal Housing Association offers loans to lower-income
Americans. Look for the phrase "FHA approved"
when looking at ads for homes.
Getting the Best Rates for Your Mortgage
Naturally, you want
to get the best deal for the least amount of money. This holds
true for mortgage rates as well.
A lower interest rate means a lower monthly
mortgage payment, which can save you much money in the long
run. Also, it is easier to qualify for a lower payment than
a higher one.
You basically have two routes to finding
the best rate. The first is to do all the research on your
own. The second is to use a mortgage broker.
Do-It-Yourself
With the advent of the Internet, much information is readily
available. Once you have educated yourself sufficiently about
real estate loans, all it takes is the time and energy to
sift through online resources to find the information you
need.
Rates change quickly. That great rate you find today might
not be there tomorrow. Once you find the rate you're looking
for, submit a loan application and lock in that rate.
Here is a source for interest rates on the Internet:
When comparing loans,
make sure that you're comparing loans of the same type. For
example, you find that "Loan A" for a 30-year loan
has a much lower interest rate than "Loan B" (also
for 30 years). Upon further inspection, you find that "Loan
A" is technically an adjustable rate mortgage. Its payment
is based on a 30-year amortization, but becomes due through
either payment or refinancing at the end of 5 or 7 years.
These are frequently referred to as a 5-year or 7-year fixed-rate
mortgage. While both said "30-year", they're not
the same type of loan.
Ask the lender for a statement detailing all fees associated
with the loan. Factors such as "points" (loan fee),
interest rate and "garbage fees" (extra fees which
some lenders charge) can vary greatly from one lender to another.
Mortgage Broker
If you don't have the time or experience to "do it yourself,"
look for a qualified mortgage broker. Ask friends & associates
who have refinanced or purchased recently if they have a broker
they can recommend. You'll want to find a broker who is energetic,
flexible & knowledgeable about finance and loans. You
need someone who has your best interests in mind.
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Rudy Molinet