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LOAN PROGRAM HIGHLIGHTS
Below is a brief explanation of some of the most commonly used loan programs. Consult your Loan Officer for further details.

FIXED RATE LOAN - A loan which has an interest rate that remains constant throughout the life of the loan.

BUY-DOWN - A fixed rate loan where the interest rate and payment are reduced for a specific period of time by paying the interest up front to subsidize the lower payment.

BALLOON LOAN - A fixed rate loan that is amortized over a 30 year period but becomes due and payable at the end of a certain time (usually 3, 5, 7 or 10 years). May be extendible or may rollover into another type of loan.

GRADUATED PAYMENT MORTGAGE (GPM) - A fixed rate loan which has payments starting lower than the payment on a standard fixed rate which then increase by a predetermined amount each year for a specified number of years (usually five to seven years).

ADJUSTABLE RATE MORTGAGE (ARM) - A loan that has an interest rate that increases or decreases at specified times during the life of the loan. The change in the interest rate is usually tied to a financial index (i.e. Treasury Bill, LIBOR, Cost of Funds, etc.) and is determined by adding a predetermined margin to the index.

FHA LOAN - FHA loans are available as a fixed rate, ARM, GPM or buydown. They are loans that are insured by the Federal Housing Administration and offer low down payments and higher qualifying ratios. There is a maximum FHA loan limit which varies from region to region.

VA LOAN - A no downpayment loan available to eligible veterans. VA loans are insured by the Veterans Administration. The maximum VA loan is currently $207,000 with no downpayment.

COMMUNITY HOMEBUYER'S PROGRAM - A fixed rate loan with a low (3% to 5%) downpayment, no cash reserve requirement and easier qualifying ratios. Subject to borrower meeting income limits and attendance of a four hour training course on home ownership.

RECDS (FARMERíS HOME LOAN) - A fixed rate loan with zero down payment, no cash reserve requirements. Can only be used in rural areas (in Stanislaus County, all areas qualify except Modesto, Ceres, Empire and Turlock). Do not have to be first-time home buyer, but can only own one home at a time. Income limits and other restrictions may apply.