Ambient Home Lending

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Understanding Different Loan Types

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Loan FYI-FAQ
Understanding Different Loan Types

So what type of loan do you need? How do you know that the scenario we propose is the best available? Are there options you don’t know about? How can you save money?!

Ambient Home Lending believes the way to earning a Clients trust is through a thorough understanding of their choices. Too often, with other lenders, borrowers are pushed into a loan that does not truly suit their needs. One of the greatest benefits offered our Clients is the broad range of products we have and can customize to their needs… and not be shackled to the narrow range of “cookie-cutter” loans offered at other lenders.

Here is a range of options for First Trust Deed notes (also known as First Mortgages) you should know about… some are self explanatory while others require a little further detail:

Stated Income Qualifying: For borrowers who have a good credit score, 2 year work history in the same line and reasonable reserves, we do not need tax returns or income documentation. This applies to borrowers with alternative income or Self-Employed. This option CAN be used by W-2 employees with some conditions. This type of qualifying sometimes is known as ALT-A qualifying.
Stated Income/Stated Asset: Same as above but not using assets to qualify.
NO Ratio: Must have good credit score and must prove 2 years consistent work history, not income.
NO Documentation: Must have very good credit score, but does not have to prove employment, income or assets.
Interest Only Payments: Minimum Payments which account only for the interest portion with no Principal. Most loans of this type allow for Principal adjustments without penalty.
A.R.M. (Adjustable Rate Mortgage): To qualify, a borrower may choose to use this strategy which offers flexibility in loan amount and lower minimum payments. Often, the note is written to include a “fixed” rate period (i.e. 1 year, 3 year etc.) after which the rate will adjust with the index on which it is based (Prime, LIBOR, MTA…etc). You can also get an A.R.M. which is fully adjustable, meaning it adjusts each month with the index of choice, plus a margin.
Negative Amortization*: In order to qualify for a larger loan amount, the borrower can have a fixed period where the lender adjusts the payment below the note rate/term payment, then applies the amount which has been adjusted down to the unpaid loan balance.
Option A.R.M.: Like the ARM above, the Option ARM offers payment options based on a Fixed Rate period which converts at some point to an adjustable. For example, for the first 3 years of your loan you will be offered the right to make minimum payments based on the following amortizations: Negative Amortization* (see description), Interest Only amortization and Principal and Interest amortization. Ambient Home Lending offers this product only under strict understanding of its use.

Ambient Home Lending holds sacred the trust that you, our Client, place in us. We are proud of our record of satisfied borrowers who have returned to us over the years because they know that we take our pledge of service seriously and dedicate our work to making sure that each Client gets what they NEED, not what we want to sell!

Ambient Home Lending promises to help you make the right Purchase Loan, Refinance, Home Equity Loan, Construction Loan or Investment Property Loan… That is our pledge to you, our Client.

*Ambient Home Lending does not endorse or actively sell this type of amortization without specific request by our Client. Negative Amortization can result in a loan balance in excess of the homes value in certain circumstances.