Smiling woman holding housekeys standing outside new home.
Adjustable rate mortgage

110% financing available

No private mortgage insurance (PMI)

Financing for many home needs

You can use an LGFCU Adjustable Rate Mortgage (ARM) to purchase or refinance a primary home, buy a first home, vacation home, rental property, and even to build a house. It’s an affordable choice with cost-saving features like competitive rates and no private mortgage insurance (PMI) required. All with a financial partner you trust!

How does an ARM loan work?

With our adjustable rate mortgage, the loan rate is subject to change every five years. The maximum interest rate adjustment is 2% every five years or 6% over the life of the loan.

Any property you buy or refinance must be located in North Carolina, South Carolina, Virginia, Georgia or Tennessee. You must reside in North Carolina or bordering states to be eligible.

Budgeting for home expenses made easy

We make your life easier by building your home expenses into your monthly payment. Your estimated annual property tax and homeowners insurance premium payments are added to your principal and interest payment, then placed in an escrow account every month. This account earns dividends equal to the Share Account rate. When it’s time to pay those bills, the Credit Union sends those payments on your behalf.

Fees and other settlement costs

There are no application or credit report fees, but other costs may arise during the mortgage loan process. At the time of application, your Credit Union loan officer will provide a loan estimate of all settlement costs such as appraisal fee, origination fee, attorney fees, recording fees, title insurance costs, and survey and pest inspection costs (typically not required.) The origination fee is 1.00% of the loan amount with a cap of $2,500. There is an additional fee for refinance transactions of 0.50% of the loan amount (no cap).

Down payment assistance program 

For first-time homebuyers applying for an ARM Loan, special programs are available to further reduce the costs of homeownership.

The Federal Home Loan Bank of Atlanta (FHLBA) First-time Homebuyer Program is available for people buying a home for the first time or those who haven’t owned a home in the last three years. FHLBA grants help members with down payment and closing costs.

How this program works:

  • Grants up to $7,500 for down payment and closing costs.
  • Applicant must contribute a minimum of $1,000 of personal funds toward the down payment and closing costs.
  • Total household income must not exceed 80% of the median income for the county in which the home is being purchased.
  • FHLBA grants are only available to first-time homebuyers approved for an ARM Loan.
  • Grant recipient living in the home for at least five years won’t have to repay the funds.
  • Funds available on a first-come, first-served basis.

Another money-saving option is the Mortgage Credit Certificate offered through the North Carolina Housing Finance Agency. This certificate works best with members buying a first home because it reduces the tax liability on a home purchase.

If you’re trying to decide whether to get an ARM Loan or our First-Time Homebuyers Loan, use the table below to compare features and special programs for each. It’s also a good idea to consult your tax advisor for additional guidance.

Compare: ARM Loan or First-Time Homebuyers Loan

Loan Features
ARM Loan
First-Time Homebuyers Loan
Type of Mortgage
Adjustable rate
Adjustable rate
Rates

May adjust every 5 years. Rates vary depending on LTV.

May adjust every 5 years. Same rate regardless of LTV.
Financing

Up to 110% LTV

Up to 100% LTV

Terms
Up to 30 years
Up to 30 years
PMI

No PMI

No PMI

Eligibility
No prior homeownership restrictions unless applying for special programs.
Applicant must have never owned a home or not purchased a home in the past 3 years
Closing costs assistance*

Grant up to $7,500 with minimum member contribution of $1,000 to down payment and closing costs via FHLBA program.

Up to an additional $2,000 in closing costs from LGFCU. FHLBA grant not offered for this mortgage.

Mortgage Credit Certificate*

Federal income tax credit for 30% of the mortgage interest payment each year up to a maximum benefit of $2,000 per year.

Federal income tax credit for 30% of the mortgage interest payment each year up to a maximum benefit of $2,000 per year.

Loan applicants must meet mortgage program eligibility requirements to take advantage of closing costs and down payment assistance benefits.

Financing to fit your needs

The maximum loan amount depends on the loan's purpose, the type of loan and the occupancy status. For purchases, maximum financing and loan-to-value tier is determined based on the lesser of the sales price or appraised value.

Loan-to-value ratio is the portion of the appraised value of the property that is not covered by your down payment.

  • 100.1% to 110% financing for no cash-out refinances of single-family primary residences. Cash-out is defined as any funds that exceed the balance owed on the first or second mortgages being paid off.
  • 90.1% to 100% financing available for purchases and no cash-out refinances of single-family primary residences.
  • Up to 90% financing for purchases and refinances of primary residences.
  • Up to 90% financing for purchases and refinances of a second home.
  • Up to 80% financing for the purchase of a rental property or for a no cash-out refinance of a rental property; further limited to 65% loan-to-value for cash-out refinances.

Manufactured Homes can typically serve as collateral, but must be the primary residence of the borrower.

Each member may finance up to six properties with the Credit Union, but only one may be financed at greater than 90% loan-to-value.

Property must be located in North Carolina, South Carolina, Virginia, Georgia or Tennessee. Members must reside in NC or bordering states to be eligible.

Let’s get started!

Download the Loan Information Checklist to know what information you’ll need to complete a loan application.

Next Steps

Take the first step toward your new home today! Choose a way to apply.

  • Log in to Member Connect. Select the Loan Center tab. Then choose Mortgage Center.
  • Call us at 888.732.8562.
  • Visit your local branch.
  • Not an LGFCU member yet? Join us!

The FHLBA First-time Homebuyer Product is available only through our ARM products. ARM loans are subject to approval. Property must be located in NC, SC, GA, TN or VA. Members must reside in NC or bordering states to be eligible. Call us or visit your local branch for additional information and guidelines.

Mortgage loans are subject to approval. Greater than 90% loan-to-value limited to maximum financing of $500,000. Additional fee for refinance transactions of 0.50% of the loan amount (no cap). Mortgages are available for properties located in NC, SC, GA, TN or VA. Members must reside in NC or bordering states to be eligible.