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by CareyBot

Merrill Lynch is now offering its blended-rate mortgage, which combines the lower rates of an adjustable-rate mortgage with the lower risk of fixed-rate home financing. The blended-rate mortgage combines a fixed rate and an adjustable rate during an initial period of 3, 5 or 7 years. The blended rate increases or decreases half as much as a traditional ARM. The mortgage includes interest-only payments during the blended period and rates are adjusted semi-annually based on the 6-month London Interbank Offered Rate. After the blended period, the loan is amortized and the interest rate continues to adjust semi-annually based on the 6-month LIBOR plus a margin of 2 percent. Other features include no prepayment penalties and large loan amounts available, including jumbo loans. Merrill Lyn...