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Real Estate S
Eileen M. Day REALTOR
CONVERTIBLES AND
CARRYOVERS
Are you ready for the latest wrinkles In mortgage financing? The two latest innovations in adjustable rate mortgages are convertibles and carryovers. Convertibles make sense for those buyers who would prefer the predictability of a fixed-rate mortgage but can't afford Its higher Initial rate. Convertible adjustable mortgages can be transformed Into a fixed rate loan during the second through the fifth year of the loan period. You pay a fee of about *100 and (if you desire) can get a fixed rate that is an 1/8 to a 1/4 of a percentage point higher than the regular fixed rate. There Is no further need to qualify or pay any points for the new mortgage.
What might be termed a carryover adjustable mortgage (backed by the FHA) may be the prototype of future conventional mortgages. However, borrowers should be wary of them. With carryover ARMS. Interest rate step-ups are limited to one percentage point a year, but increases that exceed the cap can be carried over to future years.
If there is anything we can do to help you In the Held of real estate please stop In at EILEEN M. DAY. Realtor, the Clopton House, Washington. Va 22747. Phone 675-3033. Were here to help.
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