Traditional Mortgage, Adjustable Rate Mortgage, Fixed Rate Mortgage

Traditional Mortgage

A Variety of Loan Products to Achieve Your Goals

At Chevy Chase Bank, we offer a full suite of traditional home financing products to meet your particular needs. And, with Home Loan Express—our fast, easy and secure mortgage application—you can apply online for a mortgage, and in minutes, you’ll have a pre-approval decision on a wide variety of mortgage products.

Adjustable-Rate Mortgages, also called ARMs, provide an initial fixed-rate period followed by an interest rate and payment that periodically adjusts based on the current interest rate environment. This allows you to realize the benefits of lower interest rates and payments in a falling interest rate environment.

The initial interest rate on this type of loan is typically lower than the interest rate on a fixed-rate mortgage. ARMs are offered for fixed periods of 3, 5, 7 or 10 years, and you can choose from an annual or semi-annual adjustment period.¹

Adjustable-Rate Mortgages are recommended to borrowers who:

Seek extra borrowing power, based on a lower initial payment than is typically available with a fixed-rate mortgage
Want to take advantage of a lower monthly payment to save money
Plan to refinance or sell their property in a few years

Fixed-Rate Mortgages offer the same interest rate and monthly payments throughout the entire life of the loan.

Typically, the longer the term of the loan, the lower the monthly payments will be. With a shorter term, you will have higher monthly payments. However, you will realize a savings in the amount of interest you will pay over the life of the loan. Chevy Chase Bank offers fixed rate mortgages with a 10, 15, 20, 25 or 30-year term.²For jumbo loans (loans greater than $417,000), we offer 15 and 30-year terms.³ Fixed-Rate Mortgages are recommended to borrowers who:

Look for predictable monthly payments over the entire life of the loan
Are willing to pay a higher interest rate in return for protection against the possibility of rising interest rates
Are interested in building equity in their property through monthly principal and interest payments

7/23 Balloon Mortgages (also known as fixed-to-adjustable rate mortgages) offer a lower initial interest rate than a fixed-rate mortgage while still providing the security of a fixed rate and payment guarantee for a set number of years.

Chevy Chase Bank offers a 7/23 balloon mortgage loan which is fixed for the first seven years. At the end of this term, you may choose to either pay the remaining balance or refinance to a 23-year fixed rate mortgage at then current market rates.⁴ 7/23 Balloon Mortgages are recommended to borrowers who:

Look for a lower introductory rate and payment while still having the predictability of an initial fixed monthly payment
Plan to stay in their home for a limited time
Want a lower fixed payment to match the number of years they will be in the property, without paying a higher rate typically associated with a 15- or 30-year fixed-rate mortgage

Complete a Home Loan Express online application now, or apply by calling us at 301-987-BANK or 1-800-987-BANK (out of area). Our Mortgage Advisors are available seven days a week. If you would prefer that we contact you, please complete our online request form.

¹ For example, on a 5/1 LIBOR Adjustable Rate Mortgage, the interest rate and payment are fixed for the first five years of the loan. The interest rate and payment may adjust every 12 months thereafter, and may not increase or decrease more than 2.0% at each 12-month adjustment. The interest rate cannot increase more than 5.0% over the term of the loan. For example, a 5/1 LIBOR ARM for $300,000 with a 30-year term and an initial interest rate of 6.00% (6.035% APR), repayment will consist of 60 monthly payments of $1,798.65. If the interest rate were to increase by the maximum 5.0 percentage points to 11.035% APR, then the monthly payment would increase from $1,798.65 to a maximum of $2,500.25 in the fifth year. Other rates and terms are available. The terms used in this example are for illustrative purposes only, and the actual terms you receive may be different depending on your individual circumstances.
² For example, a 30-year fixed rate loan for $300,000 with a 6.50% interest rate (6.634% APR) would require 360 monthly principal and interest payments of $1,896.20. Taxes and insurance escrows are not included. Other rates and terms are available. The terms used in this example are for illustrative purposes only, and the actual terms you receive may be different depending on your individual circumstances. Loans with longer terms may increase the total number of monthly debt payments, as well as the aggregate amount paid over the mortgage term, as compared to loans with shorter terms.
³ For example, a 30-year fixed rate loan for $500,000 with a 6.50% interest rate (6.634% APR) would require 360 monthly principal and interest payments of $3,160.34. Taxes and insurance escrows are not included. Other rates and terms are available. The terms used in this example are for illustrative purposes only, and the actual terms you receive may be different depending on your individual circumstances. Loans with longer terms may increase the total number of monthly debt payments, as well as the aggregate amount paid over the mortgage term, as compared to loans with shorter terms.
⁴ For example, a 7/23 balloon for $300,000 with a 6.375% interest rate would require 84 monthly principal and interest payments of $1,871.61. Taxes and insurance escrows are not included. After seven years (84 payments), the outstanding balance is due to the lender or must be refinanced to a market level fixed-rate mortgage. Specific requirements must be met to qualify for a refinance and not all borrowers will meet those requirements.

Traditional Mortgage

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