What Are Hybrid Loans

What Are Hybrid Loans



What are hybrid loans?
Over the​ last several years consumers have started to​ request alternative financing to​ a​ traditional mortgage from lending companies .​
The mortgage lenders response to​ this overwhelming demand was the​ creation of​ hybrid loans .​
What exactly are hybrid loans you​ may be asking yourself? Hybrid loans include some of​ the​ following .​
Piggy back loans are hybrid loans that allow consumers the​ opportunity to​ purchase a​ home with a​ smaller down payment and possible avoid having to​ have private mortgage insurance .​
The two loans are approved simultaneously and will generally result in​ lower payments per month then a​ traditional mortgage and private mortgage insurance.
Graduated payment mortgages are another hybrid loan option .​
This type of​ hybrid loan starts off with smaller payments that gradually increase over a​ period of​ five years .​
This might be a​ great financing option for individuals who expect their income to​ increase over the​ next several years however since early payments on​ this type of​ hybrid loan are applied to​ interest first it​ could cause the​ principal amount for you​ loan to​ increase.
Other great alternative mortgage options include government programs such as​ VA and FHA loans .​
These types of​ loan help first time home buyers,​ lower income consumers and veterans afford to​ purchase homes with lower monthly payments and little to​ no down payments.
Hybrid loans offer an​ excellent alternative for home financing to​ those that may not have their needs met by a​ traditional mortgage .​
Because of​ their more liberal qualifications and as​ many are tailored to​ fit specific needs more consumers are finding they are more easily able to​ finance the​ new home they have been seeking.




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