Mortgages
Mortgages

Mortgage Types

Our knowledgeable staff is here to assist you in selecting the right mortgage for your needs. Below you will see a short selection of mortgages that our lenders have the capability to handle.

We have the ability to handle lots of special requests which may not be listed below, so contact us today.

Type Description Benefits

30 Year
Fixed Rate Mortgage

The interest rate is fixed for 30 years and will not change at any time during that period. The loan is fully amortized and paid in full in 30 years.

This is the most popular mortgage program as it eliminates the interest rate risk of an ARM and the rate/monthly payments are predictably fixed for the life of the loan.

15 Year
Fixed Rate Mortgage

The interest rate on this program is fixed and the loan completely amortizes in 15 years. This does result in higher monthly payments versus a 30 year mortgage even though the interest rate is lower.

The 15 year fixed rate loan saves a huge amount of interest relative to a 30 year mortgage. The higher monthly payments are too much for some borrowers but equity is accumulated much faster on this program.

Adjustable Rate Mortgage (ARM)

This type of mortgage has an interest rate that is initially fixed for a certain period of time (usually 3, 5, 7 or 10 years.) The interest rate may then vary and is adjusted periodically based partly on a pre-selected index. Also known as a variable rate mortgage.

ARMs can offer substantial interest rate savings as compared to long term fixed rates. These programs can be ideal for borrowers with defined time frames of ten years or less.

10/1 Adjustable Rate Mortgage

The interest rate on this loan program is fixed for the first ten years. After that period the rate adjusts annually for the remaining 20 years of the 30 year loan term. Each rate adjustment is predicated on a pre-selected index (usually LIBOR or Treasury Bill) plus a margin of interest. Annual and lifetime rate caps provide some protection against rising rates.

This is the most stable of ARM loans as it offers a decade of fixed rate protection. The interest rate is usually slightly lower than that of a fixed rate mortgage.

7/1 Adjustable Rate Mortgage

The interest rate on this loan program is fixed for the first seven years. After that period the rate adjusts annually for the remaining 23 years of the 30 year loan term. Each rate adjustment is predicated on a pre-selected index (usually LIBOR or Treasury Bill) plus a margin of interest. Annual and lifetime rate caps  provide some protection against rising rates.

This is a very popular mortgage program as the average life of a mortgage loan is about 7 years. The interest rate is typically lower than a fixed rate and a 10/1 ARM but the program still provides 7 years of fixed rate security.

5/1 Adjustable Rate Mortgage

The interest rate on this loan program is fixed for the first five years. After that period the rate adjusts annually for the remaining 25 years of the 30 year loan term. Each rate adjustment is predicated on a pre-selected index (usually LIBOR or Treasury Bill) plus a margin of interest. Annual and lifetime rate caps  provide some protection against rising rates.

The interest rate on this loan is usually lower than that of a 7/1 ARM. This program provides even more interest rate savings for those borrowers comfortable with the shorter 5 year fixed rate scenario.

FHA Loan

This type of loan is insured by the Federal Housing Administration (FHA.) FHA loans are available to all qualified borrowers. Programs include both fixed rate loans and adjustable rate mortgages. Loan limits vary depending on geographic areas. FHA charges mortgage insurance on these loans.

The two main benefits of an FHA loan are ease of qualifying and cash down-payment requirements. Qualifying requirements are generally more relaxed than that of conventional loans and the minimum down-payment is 3.5%.

Veterans Administration (VA) Mortgage

A VA mortgage typically requires no down-payment and flexible qualifying ratios for qualified veterans. The VA charges a “funding fee” for all non disabled veterans. This fee is usually financed. 30 year and 15 year fixed rate loans are available.

Flexible qualifying guidelines and no cash down-payment are very attractive features of the VA loan. There is no monthly mortgage insurance on this program.

VHDA

The Virginia Housing Development Authority offers special rates and programs to qualified first time homebuyers. There are income limits and other restrictions.

VHDA loans can be extremely attractive to Virginia borrowers. Qualifying guidelines are more liberal than other loan types and low/no cash down-payment options are still available.


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Mortgage Terms

This glossary will help you familiarize yourself with various mortgage terms.

Mortgage Resources

Access checklists, worksheets, calculators, and useful links to learn more.


 

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Union Mortgage Group
4355 Innslake Drive, Suite 350
Glen Allen, VA 23060

NMLS #: 173406 Equal Housing Lender