You've probably seen or heard the ads for 2% or even 1% mortgage money. Rates like that only exist for car loans right? Wrong. I've spent considerable time investigating some of these programs and found one I feel could be very beneficial to your financial future.

Basically what we are talking about is an adjustable rate mortgage that has a provision for locked-in low monthly payments or a higher interest-only pay option. The one I'm recommending has a start rate of 1.95%. On a loan of $200,000 that's a monthly payment of just $734.25 vs. a payment on a typical fixed rate of 6% of $1,199.10. A savings of $464.85 a month for at least the first year! After one year your payment can increase no more then 7.5%, guaranteed, which would be $789.32. You're still saving $400 a month over the fixed rate, more than $10,000 saved over just the first 2 years! The rate cap is in effect for five years because by then you will have caught up with your true interest rate, which is index plus margin.

The index is what your actual interest rate is tied to. You've probably heard of the T-bill or LIBOR, both popular but volatile indexes. The loan I recommend is tied to C.O.S.I. That's the cost of savings paid to consumers by one of the largest banks in the country. That index includes checking accounts folks!

How much does your bank pay you on your checking account? Not much I bet. This translates into a low, less volatile index which means a low, less volatile payment for you! Now the important thing is what you do with that initial savings you'll receive at least the first five years. Properly invested, you'll not only have a home paid for at the end of your 15 or 30 year term, you'll have a considerable nest egg as well!