Forbes Magazine recently ranked Colorado as one of the top places to live in the United States, citing its quality of life as being the most attractive appeal to residents. If you’ve dreamed of owning your own home in Colorado, BancSource Mortgage is the company to help make your dreams come true. We offer a full range of home mortgage loans and will find a custom Colorado mortgage that fits your needs and financial situation.

We are a locally owned and operated company that has been serving Coloradans since 1995. We will walk you through the many varieties of home mortgage loans and put you at ease every step of the home mortgage process. BancSource’s experts will explain the pros and cons of each mortgage option available, discussing your finances, your goals and financial prospects, and your preferences. And, of course, will always educate you on all of the fees to expect when buying a home, such those for as appraisals, closing costs, and settlement.

Contact BancSource today at 303-394-2222 for a free consultation.

Mortgage Programs

Fixed Rate Mortgages

The most common mortgage programs involve fixed rated loans, which lock in the rate of interest to be paid on the loan so that your monthly payments (interest and principal) never change over time. Property taxes and homeowners insurance may fluctuate, but your monthly payments remain stable. Fixed rate loans have two distinct features:

1)    The interest rate remains fixed for the life of the loan.

2)    The payments remain level for the life of the loan and are structured to repay the loan at the end of the loan term.

The most common fixed rate loans are 15- and 30-year mortgages. There are also “biweekly” payment programs that can reduce the life of the loan by calling for half the monthly payment every two weeks. (Since there are 52 weeks in a year, you make 26 payments, or 13 “months” worth, every year.)

Adjustable Rate Mortgages (ARMs)

Adjustable-rate loans can offer attractive interest rates, but the interest paid on adjustable-rate loans over the years changes with the interest rate, so when rates are low, you pay less each month, but when rates are high, you will pay more accordingly. A few options are available to fit your financial needs and your risk tolerance with the various market instruments. Different indexes are available for both purchases and refinances. Choosing an ARM with an index that reacts quickly lets you take full advantage of falling interest rates. An index that lags behind the market lets you take advantage of lower rates after market rates have started to adjust upward.

Rate Buy Downs

Popular mortgage buy downs typically work like a subsidy. It’s like socking away $1200 in the bank and withdrawing $100 every month for 12 months to help make your mortgage payment. Payments are reduced and figured on a lower interest rate over a specific term. The difference between the “real” note rate and the lowered interest rate is paid in cash by the seller or the buyer.

A common buy down loan is the 2-1 buy down. In the past, for a buyer to secure a 2-1 buy down they would pay 3 points above current market points in order to pay a below market interest rate during the first two years of the loan. At the end of the two years they would then pay the old market rate for the remaining term.

Another common buy down is the 3-2-1 buy down which works much in the same way as the 2-1 buy down, with the exception of the starting interest rate being 3% below the note rate. Another variation is the flex fixed buy down program that increase at six month intervals rather than annual intervals.

Balloon Loans

Balloon loans are short-term mortgages that have some features of a fixed rate mortgage. The loans provide a level payment feature during the term of the loan, but as opposed to the 30 year fixed rate mortgage, balloon loans do not fully amortize over the original term. Balloon loans can have many types of maturities, but most balloons that are first mortgages have a term of 5 to 7 years. At the end of the loan term there is still a remaining principal loan balance and the mortgage company generally requires that the loan be paid in full, which can be accomplished by refinancing. Many companies have other options such as a conversion feature at the end of the term. For example, the loan may convert to a 30 year fixed loan at the thirty- year market rate plus 3/8 of a percentage point. Your conversion can be guaranteed based on certain criteria such as having made your last 24 payments on time.

Gift Funds

First time homebuyers may have the income and credit stability to qualify for home mortgages; however, they may not have the necessary funds for the down payments and/or closing costs. Gift funds are available as grants up to $40,000 based on the final sale prices of the homes and the needs of the buyers. The program funds are free monies offered by the program to qualified homebuyers, requiring no repayments, no silent second mortgages and no recapture penalties. The funds are offered towards the purchase of seller-participating homes anywhere in the United States, with no income limitations and no geographical restrictions. The money given to the buyer is a true gift.

Gift money can come from relatives, employers and nonprofit organizations. It can’t come directly from sellers. But sellers can contribute money to nonprofits that then pass along the money in the form of gifts to the homebuyer.

Qualifying for a Mortgage

A buyer qualifies for the Down Payment Assistance Program by qualifying for any owner-occupied home loan from a lender who accepts grant funds from a nonprofit organization, and by purchasing a participating home from a seller who agrees to make a contribution to the program after the home closes. Buyers may achieve potential tax benefits, appreciation of the property value, build equity, buy a home at lower cost now than at sometime in the future, receive free grants for up-front home buying expenses, and just enjoy that good feeling of home ownership. The availability of a down payment assistance grant can increase their pool of potential buyers, and their bottom-line net is comparable to a traditional loan.

Contact Us Today!

Contact BancSource today at 303-394-2222 for a free consultation to discuss any of the mortgage programs we offer.