New ARM Product Hits Market

SouthStar offering ARM with ongoing payment choices
By MortgageDaily.com staff
4/7/2005

A new wholesale adjustable rate mortgage gives borrowers four ongoing options for their monthly payments.

The Choice Option ARM, announced today by wholesaler SouthStar Funding, is based off of either the MTA or LIBOR indexes.

Borrowers can choose from four monthly payment options including just the minimum payment, an interest only payment, a fully amortized 30-year payment or a fully amortized 15-year payment, according to the nonprime wholesale lender.

SouthStar, whose Web address is www.SouthStar.com, stated the program is only available on a wholesale basis.

The program also includes up to 3-month introductory rates starting out at as low as 1 percent, the announcement said.

Underwriting guidelines for the ARM allow for credit scores as low as 620 and combined LTVs as high as 100%, SouthStar said. The maximum loan amount is $3 million, and most property types are acceptable.

"Our brokers and correspondents requested that we offer an Option ARM, and, in keeping with our goal of providing superior personal service, we added unique features that are unavailable anywhere else," Mike Fierman, an executive for the Atlanta-based lender, said in the announcement. "The excitement of our customers and our sales team to the Choice Option ARM has been the best reaction to a new SouthStar Funding product in years."

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