THE ADVANTAGE
Your monthly recap of the most important
mortgage-related news, perspective, and advice
November 2023
4 minute read
Asking any search engine “How do I find the right mortgage”, returns a dizzying amount of information in less than a second. Don’t let your members ask anonymous sources their pressing mortgage questions! Instead, use these questions to help your members find the right mortgage for their next home purchase.
15 and 30 Year Fixed-Rate Conventional Loans
Most Popular
Rates Not Always Favorable
Financial Stability
- Do you want to guarantee your payments will never change?
- Can you afford (and do you want) a higher monthly payment in order to save money in the long run?
- Do you plan to own this home for 10 years or more?
Conventional loans or unsecured loans are mortgages that are not insured by the federal government. Fixed-rate loans offer predictable payments, but may require higher down payment amounts. A 15-year term has a higher monthly payment compared to a 30-year term, but it builds equity faster and the owner pays less interest over the life of the loan.
FHA Loans
Less Restrictive Guidelines
Limited Down Payment
Government-backed loans
- Are you having trouble saving for the down payment?
- Do you suspect you’ll have trouble qualifying for other mortgages (due to reasons such as lower credit) to save money in the long run?
- Do you have a friend or family member who will give you money toward your down payment?
With the Federal Housing Authority providing insurance on these loans, lenders are able to offer them lower credit requirements and a lower down payment requirement (as low as 3.5%). There is a Mortgage Insurance Premium (MIP) if less than 10% is put down.
VA Loans
0% Down
No Mortgage Insurance
For Military and Families
- Are you or your spouse active or former military?
- Will you be living in the home you’re buying?
Offered by the U.S. Department of Veterans Affairs (VA), these loans help active duty military, veterans, and surviving spouses become homeowners. There are no down payment requirements, no monthly mortgage insurance premiums, and lower closing costs compared to conventional loans (loans not backed by the government).
USDA Loans
Payment Assistance
Build, Repair, or Renovate
No Down Payment
- Do you live in a rural area?
- Do you suspect you’ll have trouble qualifying for other mortgages (due to reasons such as lower credit or income)?
- Are you currently without housing?
A U.S. Department of Agriculture (USDA) loan is specifically designed for low income homebuyers in rural areas. It provides payment assistance, and has no down payment requirement.
Adjustable Rate Mortgages (ARM)
Lower Initial Rates
Great for Short-term owners
Some Unpredictability
- Do you think rates will go down in the future?
- Is there a reason you will need to sell your home before the initial adjustment period?
- Will you be receiving a large sum of money to pay off the mortgage early?
Unlike a fixed-rate mortgage, the interest rate for ARMs changes over the term. It is set for an initial fixed rate period, but then adjusts based on the index. Today’s ARM could be a good option for some homebuyers, but there are also instances where it should be avoided.
Side-by-Side Comparison by Loan Type
Use this table to give members a quick overview of the various mortgage options available to them.
We can explain mortgage options to your members.
Member Advantage Mortgage provides marketing collateral and resources specifically designed so it can be shared with members of our partnering credit unions. It’s both informative, and eye-catching.
For example, we have a booklet called “Which mortgage is best for you?” that goes into even greater detail than the information presented here. We’ll even co-brand it with our partnering credit unions’ name and logo.
We created this six-question mortgage loan option quiz for CommonWealth One members to identify the top mortgage products they should consider. It’s a great resource for their website and sets the stage for members to have deeper conversations with a mortgage loan officer.
If you want to learn how to become a partnering credit union, please reach out to Del Smith at [Del’s phone and email].
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Who Is MAM?
Member Advantage Mortgage (MAM) is a Credit Union Service Organization (CUSO) that helps credit unions increase revenue by offering mortgage solutions to their members.
We achieve this by finding the mortgage solution that is in each individual member’s best financial interest.
What We Do
Since 2006, MAM has offered first and second mortgage origination and fulfillment services to credit unions. We also provide marketing tools (like our Mortgage Payment Calculator) to increase lead generation.
How We Can Help You
We’ll help you improve member satisfaction and deepen member relationships by offering or streamlining your mortgage delivery process. You’ll be able to serve current members so they don’t need to turn to the competition, all while increasing your mortgage revenue and generating non-interest income.
How You Can Learn More
This page goes into greater detail on exactly how we provide support and partner with credit unions.
You can also call Jim Mitchell, our Senior Vice President of Strategic Partnerships, to get answers to any questions about partnering with MAM.
Disclaimer:
This information is solely for credit union and mortgage professionals and should not be distributed or provided to consumers or the general public.
This is not an offer for extension of credit nor a commitment to lend. Programs, rates, terms and conditions are subject to change without notice. Certain restrictions may apply. All approvals subject to underwriting guidelines. Not all applicants will qualify. Member Advantage Mortgage, LLC is an Equal Housing Lender. We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.
Member Advantage Mortgage, LLC NMLS #1557. Alabama Consumer Credit License # 22717. Arkansas Combination Mortgage Banker-Broker-Servicer License # 104160. Colorado, Regulated by the Division of Real Estate, Mortgage Company Registration NMLS ID # 1557; check the license status of your mortgage loan originator at http://www.dora.state.co.us/real-estate/index.htm. Connecticut Mortgage Lender License # ML-1557. District of Columbia Mortgage Lender License # MLB1557. Delaware Lender License # 011515. Florida Mortgage Lender License # MLD781. Georgia Residential Mortgage Licensee, License # 36659. Louisiana Residential Mortgage Lending License NMLS ID # 1557. Massachusetts Mortgage Lender License # ML1557. Maryland Mortgage Lender License # 06-19371. Michigan 1st Mortgage Broker/Lender/Servicer Registrant # FR020440. Licensed by the North Carolina Commissioner of Banks, Mortgage Lender License #167098. Licensed by the New Hampshire Banking Department. New Hampshire Mortgage Banker License # 14242-MB. Licensed by the New Jersey Department of Banking and Insurance. New Jersey Residential Mortgage Lender License NMLS ID # 1557. Licensed by Pennsylvania Department of Banking. Pennsylvania Mortgage Lender License # 33868. Rhode Island Licensed Lender, License # 20112778LL. South Carolina Mortgage Lender License #1557. Texas Mortgage Banker Registration NMLS ID # 1557. Licensed by the Virginia State Corporation Commission, Virginia Lender License # MC-5045, Virginia Broker License #MC-5045. NMLS ID # 1557.
Visit www.nmlsconsumeraccess.org for complete licensing information.