The MERIX 50/50 Wise Mortgage
“…the wise choice in today’s economy”
Don’t choose between Fixed and Variable. Choose Both!
Features:
– 50% of mortgage amount is at current 5 year fixed rate pricing (now at
– 50% of mortgage is at current 5 year ARM pricing (now at
4.64%)Prime-.40 %)
Ideally suited for:
– Customers who are unsure whether to go Variable or Fixed. This product eliminates the biggest dilemma facing
mortgage borrowers in today’s economy.
– Customers who want a low interest rate and are more risk-averse than a typical ARM client. The weighted
average interest rate
the mortgage is subject to interest rate risk.
– Customers who want added flexibility in paying down their mortgage. The two portions operate independently of
each other, so your customers can choose to make prepayments on the fixed portion which has the higher
interest rate or they can choose to pay down the ARM portion aggressively which in turn further minimizes their
future interest rate risk!
– Customers you may be on the verge of losing to a competitor.
on this mortgage is approximately 3.25% given today’s current pricing! And only 50% of
Instructions:
.
Submit the deal to MERIX as a 5-year fixed rate. Identify “50/50 Wise Mortgage” in notes to the UW
Additional Features:
– One collateral charge is registered
– Each portion operates independently in terms of payment frequencies, privileges, and prepayment penalties.
– Each portion has the usual 20/20 prepayment privileges.
– This product will be part of our regular offering (i.e. not a quick close).
–
Convertibility
:
– The ARM portion can convert to a fixed rate
extended.
– The ARM would convert at the then-prevailing MERIX rate for the term closest to the remaining term on the ARM.
This ensures
–
at any time without penalty, HOWEVER, the term cannot bethe two portions renew/mature on the same day.
Portability:
– The mortgage is portable, either to a new 50/50 product or lock in the arm portion prior to porting and port the
whole mortgage as a blended fixed rate.
–
No penalties charged in either scenario.
Rate Hold:
– 120 days rate holds on purchases, 60 day refinances.
No Transfers/Switches permitted. No pre-approvals
Additional Info:
– Max amortization is
35 years Max LTV is 95%
–
– Product will qualify at the 5 year fixed rate (
– Second Homes permitted.
15 bps rate premium applied to both portions for Stated Income or Non owner occupied Rental.unless the 3 year published rate is higher).
Compensation
however will be paid separately on each portion.
Regular 5 year term compensation applies. Compensation is the same for both ARM and Fixed