Waterstone Mortgage Corp. in Pewaukee, Wis., has introduced a zero-down, 7/1 adjustable-rate mortgage with a 20-year amortization.
The Wealth Building Loan is based on a Mortgage Guaranty Insurance Corp. program and was developed by Stephen Oliner and Edward Pinto, co-directors of the American Enterprise Institute's International Center on Housing Risk. The loan also eliminates private mortgage insurance requirements about four years sooner than 30-year conventional loans with a 3% down payment.
The loan is designed to allow homebuyers to build equity faster by applying more of the monthly payment to principal and less to interest, according to Waterstone.
The American Enterprise Institute, in Washington, is a conservative think tank that tracks the mortgage industry.
