If you or the home you are buying does not fit in any of the above categories, this is probably the mortgage for you. Downpayment is usually larger than FHA and First Time Home Buyer Programs. Readily available from most lenders. Non fixed payment mortgage. An interest rate that adjusts periodically, based on changing market rates.
Most ARMs have an initial period during which the interest rate remains the same.
Once this period ends, the ARM has a specified adjustment period at the end of which the interest rate may be adjusted up or down, depending on market conditions. Most are adjusted for the life of the loan, but some lenders offer Convertible ARMs that may be converted to a fixed rate mortgage. Balloon Mortgage Payments are amortized over 30 years, but the remaining balance is actually due, in full, after a much shorter term. Usually offers a lower interest rate. May be suitable to you if you relocate frequently or probably will sell the property before balloon is due.