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Personal Finances / Buying or Selling a Home

URL:  http://boards.fool.com/are-they-monthly-caps-or-annual-caps-is-there-a-31122943.aspx

Subject:  Re: financing the next house Date:  2/17/2014  11:44 AM
Author:  Dwdonhoff Number:  126828 of 128075

Are they monthly caps, or annual caps? Is there a lifetime cap?
No limits. No caps.

No, no, no....

The program being referenced is serviced by Merrill Lynch Wealth Management, and funded by one of three sources (currently);
PHH Bank
Bank of America
Merrill Lynch portfolio

Its interest-only for 10 years, then amortized 15 years.
Its adjustable on monthly periods, with a lifetime cap of 12%, and periodic caps of 5%.

Max loan amount is 80% of appraised value, and max debt/income ratios are 50%, back end (housing plus consumer debt.)

Who is it good for?
Savers who already have a decent head start on accumulating their positive net worth, and who are financially aware that 'rates are relative' and rising rates have roughly parallel affects to both their outstanding leverage (mortgages) and their growth asset