Features & benefits
- Jumbo loans are best for customers who need larger loans (greater than $548,250).
- The interest rate on this mortgage is fixed for 15 years. The monthly payment is sufficient to pay back the entire loan in 15 years rather than 30. Interest savings is a result of quicker payoff and maybe even greater if the 15-year rate is lower than the 30-year rate.
- You have fixed-rate security for the entire loan term and a more rapid build-up of equity. There is also significant interest savings. This mortgage is helpful if you plan to stay in the house long term.
There is a higher monthly payment than a 30-year loan due to a shorter term. The rate may still be higher than the initial ARM rate.
You can take out a 30-year loan and make additional principal payments at your convenience to get the advantages of a shorter-term without locking yourself into the higher payments. The key is that you are free to make extra payments when you want to, rather than being locked in as you would with a 15-year loan.