Help Section
The following answers addresses the most commonly asked questions. If you have any questions that aren't listed, please fill out our Contact Form. You can also contact Financial Services Unlimited, Inc. by calling 800-238-9202.

I can't afford 20% to put down on a house?
Assuming you qualify for higher monthly mortgage payments and have excellent credit history, you may qualify for a reduced down payment loan from 0 -15% down. However, you may pay a higher interest rate and loan fees (points) than someone making a larger down payment as the lender has increase loan risk.

What is private mortgage insurance (PMI)?
Private mortgage insurance (PMI) policies are designed to reimburse a mortgage lender up to a certain amount if you default on your loan. Most lenders require PMI on loans when the borrower makes a down payment of less than 20%. Premiums are usually paid monthly or may be financed. With the exception of some government loans, you may be able to drop the mortgage insurance once your equity in the house reaches 20% and you've made timely mortgage payments. The Servicing Lender of your mortgage will have the requirements for canceling private mortgage insurance.

Can I use some of my IRA or 401(k) plan for a down payment?
Under the 1997 Taxpayer Relief Act, first-time home buyers may withdraw up to $10,000 penalty free from an individual retirement account (IRA) for a down payment to purchase a principal residence. This $10,000 is a lifetime limit. The law defines a first-time homeowner as someone who hasn't owned a house for the past two years. If a couple is buying a home, both must be first-time homeowners. Ask your tax accountant for more information, or check IRS rules at http://www.irs.gov. Another source of down payment money may be is a loan against your 401(k) plan. Ask your employer or plan administrator if your plan allows for loans.

What's the difference between a fixed and adjustable rate mortgage?
With a fixed rate mortgage, the interest rate and the amount you pay each month remain the same over the entire mortgage term, traditionally 15, 20, 30 or 40 years. A number of variations are available, including five- and seven-year fixed rate loans with balloon payments at the end. With an adjustable rate mortgage (ARM), the interest rate fluctuates according to the indexes. Initial interest rates of ARMs are typically offered at a discounted ("teaser") interest rate lower than fixed rate mortgage. Over time, when initial discounts are filtered out, ARM rates will fluctuate as general interest rates go up and down. Different ARMs are tied to different financial indexes, some of which fluctuate up or down more quickly than others. To avoid constant and drastic changes, ARMs typically regulate (cap) how much and how often the interest rate and/or payments can change in a year and over the life of the loan. A number of variations are available for adjustable rate mortgages, including hybrids that change from a fixed to an adjustable rate after a period of years.

Is a fixed or an adjustable rate mortgage better?
It depends. Because interest rates and mortgage options change often, your choice of a fixed or adjustable rate mortgage should depend on: the interest rates and mortgage options available when you're buying a house your view of the future (generally, high inflation will mean ARM rates will go up and lower inflation that they will fall), and how willing you are to take a risk. When mortgage rates are low, a fixed rate mortgage is the best bet for most buyers. Over the next five, ten or thirty years, interest rates are more apt to go up than further down. Even if rates could go a little lower in the short run, an ARM's teaser rate will adjust up soon and you won't gain much. In the long run, ARMs are likely to go up, meaning most buyers will be best off to lock in a favorable fixed rate now and not take the risk of much higher rates later. Keep in mind that lenders not only lend money to purchase homes; they also lend money to refinance homes. If you take out a loan now, and several years from now interest rates have dropped, refinancing will probably make sense.

Would you like more information about how we can help you?
Please complete our Request More Information form or you may also call and speak directly to a Loan Specialist, Toll-Free at 1-800-238-9202

Fax or mail to:
Financial Services Unlimited Inc.
11950 SW 2nd St. Suite 300
Beaverton, OR 97005
(503) 626-8910 (Fax)
Toll-Free at 1-800-238-9202