Products:

Mortgages Direct has over 300 different mortgage products to choose from.  Mortgage products fall into three major product categories.  The three major product categories are Fixed-Interest Rate Products, Adjustable-Interest Rate Products, and Hybrids.

Fixed-Interest Rate Products - Mortgages that the interest rate is fixed at the time the mortgage is made and the interest rate will never change.  The term of the Fixed-Rate Mortgage can be for any number of years, starting with a minimum of five (5) years, and usually increasing by a multiple of five (5) years, to a maximum of thirty (30) years.  Niche-programs of the Fixed-Interest Rate Products include: (click on program for explanation)

Adjustable-Interest Rate Products - Mortgages that the interest rate is not fixed at the time the mortgage is made.  These mortgages are commonly known as Adjustable Rate Mortgages (ARM's).  The Adjustable Rate Mortgages have a thirty (30) year maturity only.  The interest rate on an Adjustable Rate Mortgage is comprised of three components, the index, the margin and the caps. 

1. The index is a rate that is identified by the institution.  The major indexes include, 1 Year Treasury Bill (UST), London Interbank Offered Rate (LIBOR), Cost of Funds Index (COFI), Cost of Savings Index (COSI), Cost of Deposit Index (CODI), and the Monthly Treasury Average (MTA).
2. The Margin is an amount set by the lender.  The margin is added to the index to determine the interest rate.  Margins usually range from 2.25% to 6.00%.
3. Caps.  The Caps have three components, the initial interest rate maximum adjustment, the maximum adjustment on all adjustments other that the initial adjustment, and the maximum adjustment allowed over the life of the loan.  Caps are usually expressed as numbers divided by the "/" mark, for example 2/2/6 or 5/2/5 or some other combination.  The first number represents the initial interest rate maximum adjustment for the initial adjustment.  The second number represents the maximum adjustment for all adjustments other than the initial adjustment.  The third number represents  the maximum accumulative adjustment allowed over the entire life of the loan.

Niche-programs of the Adjustable-Interest Rate Products include: (click on program for explanation)

Hybrids - Mortgages that are a combination of the Fixed-Interest Rate Product and the Adjustable-Interest Rate Product.  These mortgages have a set initial time period that the mortgage interest rate is fixed, and then the interest rate will adjust (usually annually) based on one of the major indexes, margins, and Caps.  Hybrid mortgages are usually expressed in a format of a number separated from another number by either the "/" or "-" symbols.  The more common hybrid mortgages are the 3/1, 5/1, 7/1, and 10/1.  The first number is the number of years that the mortgage interest rate is fixed.  The second number is the adjustment interval, expressed in number of years/months, upon the expiration of the fixed period.  For instance the 3/1 states that the mortgage has a three (3) year fixed-Interest rate period, and then the mortgage would adjust annually thereafter.  All hybrid mortgages are based on a thirty (30) year mortgage.  Niche-programs of the Hybrid Products include: (click on program for explanation)