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What is the Smart Rate Adjustable Rate Mortgage?

The Smart Rate Adjustable Mortgage offers an initial interest rate lower than that of a fixed rate loan.  The initial rate is fixed for either 5 or 3 years, depending on which Smart Rate product you choose.  After the initial fixed rate period, the interest rate adjusts, annually, to the Wall Street Journal's current Prime Rate.  

This product also offers a Rate Relock option, which allows you to relock your rate for five (or three) more years, anytime throughout the life of your loan!  With the Rate Relock, no mortgage application or home appraisal is required.  The Rate Relock fee is based on the state where the property is located and ranges from $295 - $595.  

To get the lowest rate, you can pay full closing costs or, for a slightly higher rate, you can pay the Low Closing cost amount of $295 to $595, depending on what state you are in. 

Also, as with all Third Federal loans, there is no prepayment penalty - principal and interest can be paid off early with no additional costs.

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