Years you plan to stay in the house	Recommended  Program
1-3 Years	6 Month,1 Year, Or 3 year Arm Loan
3-5 Years	5/1 ARM Loan
5-7 Years	7/1 ARM Loan
7-10 Years	10 Year Arm or 15 to 30 Year Fixed Loan
10+ Years	15 to 30 Year Fixed Loan

	Advantages	Disadvantages
Fixed Rate  Mortgages 30 Year Fixed 15 Year Fixed	> Monthly payments are fixed over the life of the loan. >Interest Rate Does not Change. >Protected if Interest rates increase. >Can refinance if rates go down.	< Higher interest rates. < Higher mortgage payments. < Rate does not drop if interest rates improve.
Adjustable rate mortgages 10/1 ARM 7/1 ARM 3/1 ARM 1 Year ARM 6 Month ARM 1 month ARM	>Lower initial monthly payment. >Lower payment over a shorter period of time. >Rates and payments may go down if rates improve. >May Qualify for higher loan amounts	< More risk < Payments may change over time < Potential for high payments if rates go up.
Balloon Mortgages 7 Year 5 Year	>Lower initial monthly payment. >Lower payment over a shorter period of time. >Many Balloon mortgages offer the option to convert to a new loan after the initial term.	< Risk of rates being higher at the end of the initial fixed period. < Risk of foreclosure if you cannot make balloon payments , if you cannot refinance or,if you cannot exercise the conversion option.
First Time Buyer Programs	>Lower down payment >Easier  to qualify >Sometimes can get lower rates	< May be subject to income and property value limitations <Some programs which have government subsidies may have a recapture tax if you sell the house too early
No point, No fee programs	>no closing costs >Less money required to close	< higher rates < higher payments

Imperfect credit programs

>Potential for reestablishing credit if you pay your mortgage on time. >When used for debt consolidation you may be able to reduce your monthly debt payment.

< Higher rates <Terms may not be as favorable <Harder to get long term fixed loans <Loans may have prepayment penalties