Two Step Mortgage

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I want take a mortgage, my credit score is not too good it is in mid 500. I have consulted lot of experts. But today when I was coming back from my work place a read about Two Step Mortgage. Can I qualify for this loan with low credit score???? Please tell me about its advantages and disadvantages also.

jerry · Posted: Fri Dec 02, 2005 3:38 am Post subject: RE:

Hi,

It is a type of mortgage which has elements of both fixed rate mortgage and adjustable rate mortgage.

Thanks,
Jerry

Samantha · Posted: Fri Dec 02, 2005 3:44 am Post subject: RE:

Hi Lee,

Welcome to MortgageFit Forums.

These are mortgages which have features of both fixed and adjustable rate mortgage. Interest rate charged on the initial period of the loan is fixed but in the second part of the loan the interest rate is adjustable. The names of such kind of loans are bit confusing. Like 2/28, 5/25, 7/23.

Advantage:-
It gives an opportunity to borrowers with poor credit score to buy a home and re-establish their credit score.

Disadvantage:-
If you are not able to improve your credit score you could get stuck with higher interest rate for a much longer period of time then expected.

Types of loans available to borrowers with low credit scores. For more information on this, please visit our section on mortgage with low credit score.

God Bless You.

Thanks,
Samantha

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