The problem with a 30-year mortgage is this:
Once you're in, you're in.
It used to be that people didn't think much about getting a 30-year mortgage. If they wanted to sell, they would sell. Qualified buyers were always available. And the appreciation of their home would go towards the 8-10% in selling costs. Maybe they'd even have enough left over to plunk down on their next house. And that worked fine for a while. But then around 2006, the market began to change. And suddenly, a 30-year mortgage doesn't seem as flexible as it once seemed. In fact, many people are feeling locked in by a market that has decreased in value, and the cost of selling that puts them even further behind. And the buyers? Good luck even finding a buyer.
The answer is Trio. More flexible than owning, and more secure than renting.
We've already seen how inflexible a 30-year mortgage can be. Clearly, now may not be the time for a long-term commitment. And so what are your alternatives? Well, renting has great flexiblity; you can even go month to month. But you're limited to apartment buildings or individual landlord owned homes. Renting is also very temporary, leaving your future unsecured. The answer is Trio. The third way to finance a home. Trio is built around the idea of certainty, with predictable payments, a lease term of one to five years and an option, not an obligation, to buy.
Whatever your concerns about the real estate market, Trio has three ways to solve them.
If the market goes down, you're not obligated to buy.
One of the most attractive features of Trio home financing is your ability to lock in a pre-determined purchase option price at the beginning of your lease. Then as time goes by, you get to watch the market and see if home values are increasing or decreasing. If they increase you build equity towards your down payment and can buy at any time. But if they decrease, you're not obligated to buy. This is the complete opposite of a mortgage agreement, where once you've made the decision to buy, you're stuck.
If you move in the next 30 years, a traditional mortgage might not be the best choice.
Let's face it. Getting a mortgage is not only challenging, BUT it's expensive. There's the 20% down payment up front. And 3% to 5% in closing costs. Maybe even mortgage insurance. But let's assume that somehow you make it all work. Then the monthly mortgage payments start. Sure, you can write off the interest against your taxable income (check with an accountant first), but its still money out of your pocket. In fact, in the first five years, about 80% of your mortgage payments go towards interest payments. With a mortgage, approximately half of the money you pay in the first 20 years goes towards interest. So what is the best choice? Try Trio.
Build equity during your lease so when you're ready to buy, you're really ready.
Let's say you love the Trio property you're in. And the economy and the housing market both get back on track. What next? How do you start building towards home ownership? There are several ways to build equity during your lease period. First, maintaining and improving your leased home will help retain and possibly increase your home's value. Second, if the ending value of your home is higher than your residual purchase price we'll let you use up to 7% of the appreciation as part of your down payment. Third, we apply up to 15% of your on-time monthly lease payments toward your purchase of your leased home. And fourth, financing the end purchase of your leased home through our preferred lending partners saves you the greatest amount of costs to purchase the property — your lending fees.
Consider a mid-term commitment.
Trio is the one home financing choice that's just right. Not too short. Not too long. Our leases are customized to your needs and run from one to five years. If that's not enough time for you, then we'll look to extend your lease when the time comes. On the same property if you'd like, or try another Trio property — in your town or somewhere else. Finally, a home financing program that's more secure than renting, more flexible than owning, and with greater certainty than either. It's about time, isn't it?