Home Loans

Choices… so many Home Loan choices!  Lots of paperwork, too.  And we’re here to help, every step of the way.

The Basics

If you want...

Consistent payments with low closing costs

Choose a Fixed-Rate Loan.  Your principal and interest payments will be fixed for your entire loan term (10 to 30 years).  Check rates.

A lower initial rate (still with low closing costs)

Choose an Adjustable-Rate Loan. Your rate will be lower for an initial term (usually 1 to 5 years), and then adjusts on a schedule you and CEFCU agree on. This can be a good choice if you expect your income to increase, or if you plan on moving soon. Check rates.

Are you...


Enjoy fast, free pre-approval.  Learn about Smart Lock (a 90-day rate lock you can set up even before you find your home).

Buying (or building) AND selling?

Ask about a Bridge Loan for interim financing if you find your new home, and haven’t sold your old home yet.


CEFCU offers both Construction/Permanent and Construction/Completion Home Loans. With either one, you pay just one set of closing costs, and you can enjoy a 6-month rate lock (with a Construcion/Completion Loan), or a 12-month rate lock (for a Construction/Permanent Loan). So what’s the difference? It depends on how your builder works. For more information, email us or call 1.800.542.3328, ext. 33424.

Ready for your first home?

Learn about free pre-approval and Smart Lock (a 90-day rate lock you can set up even before you find your home). Ask about low-down-payment programs like Take Five and USDA Rural Housing.  Request a free First-Time Home Buyer Kit.  And give us a call to learn about current grants and other options.

Every CEFCU Home Loan features competitive rates and low closing costs — we don’t mark up third-party costs like other lenders may do.  Jumbo Loans are also available.

For more information on Home Loans, email CEFCU; call 1.800.542.3328, ext. 33424; visit a Member Center; or view the FAQs.

Home Loan FAQs

  • What is a Fixed-Rate Loan, and which one should I choose?

    Fixed-Rate Loans are available in 10-, 15-, 20-, or 30-year terms. Principal and interest payments remain unchanged for the life of the loan; and the longer your term, the lower your payment may be. Shorter loan terms may help you to build equity quickly, but your monthly payment will be higher.

  • What is an Adjustable-Rate Mortgage?

    An Adjustable-Rate Mortgage (ARM) offers a lower initial interest rate, with the trade-off that the interest rate can change periodically, so your monthly payment could go up or down accordingly.

    When choosing an ARM, you should consider whether you could afford potentially higher loan payments in the future. An ARM may be right for you if your income is likely to increase or if you only plan on being in the home for three to five years.

    ARM Terms

    Adjustment Period: With most ARMs, the interest rate and monthly payment will remain the same for an initial time period (usually one, three, five, or seven years). After the initial adjustment period, the interest rate can change every year. For example, one of CEFCU's most popular is a five-year ARM. The interest rate will not change for the first five years (the initial adjustment period) but can change every year after the first five years.

    Index: CEFCU's ARM interest rate changes are tied to changes in an index rate. Using an index to determine future rate adjustments provides you with assurance that rate adjustments will be based on actual market conditions at the time of the adjustment. The current value of most indices is published weekly in the Wall Street Journal. If the index rate moves up, so does your mortgage interest rate; and you will probably have to make a higher monthly payment. On the other hand, if the index rate goes down, your monthly payment may decrease to your rate floor.

    Margin: To determine the interest rate on an ARM, CEFCU adds a pre-disclosed amount to the index called the margin. If you're still shopping, comparing one lender's margin to another's can be more important than comparing the initial interest rate because it will be used to calculate the interest rate you will pay in the future.

    Interest-Rate Caps: An interest-rate cap places a limit on the amount your interest rate can increase or decrease. There are two types of caps:

    • Periodic or adjustment caps, which limit the interest rate increase or decrease from one adjustment period to the next.
    • Overall or lifetime caps, which limit the interest rate increase over the life of the loan.

    As you can imagine, interest rate caps are very important because no one knows what can happen in the future. At CEFCU, a member's loan can only change once a year; your rate cannot adjust to more than 2 percent in a year or 6 percent throughout the life of the loan. All of the ARMs CEFCU offers have both adjustment and lifetime caps. Please see each product description for full details.

    Negative Amortization: Negative Amortization occurs when your monthly payment changes to an amount less than the amount required to pay interest due. If a loan has negative amortization, you might end up owing more than you originally borrowed. None of the ARMs CEFCU offers allow for negative amortization.

    Prepayment Penalties: CEFCU never charges a penalty for prepayment. Some lenders may require you to pay special fees or penalties if you pay off the ARM early.

    Selecting a mortgage may be the most important financial decision you will make, and you are entitled to all the information you need to make the right decision. If you have questions about the features of ARMs, email CEFCU; call 309.633.3424 or 1.800.633.7077, ext. 33424; or visit a Member Center.

  • Should I choose a Fixed- or Adjustable-Rate Home Loan?

    Fixed-Rate Loans are available in 10-, 15-, 20-, or 30-year terms. Principal and interest payments remain unchanged for the life of the loan; and the longer the term, the lower your payment. With a Fixed-Rate Loan, you know your principal and interest payment during the entire term of the loan, which can mean more peace of mind.

    An ARM is a loan type that offers a lower initial interest rate than most fixed-rate loans. The trade-off is that the interest rate can change periodically, usually in relation to an index, and the monthly payment will go up or down accordingly. Adjustable rates allow you to qualify for a larger loan, but the rates do vary annually after an initial period. Rates are capped, but they can increase.

    Use the calculators to determine your payments for different types of loans. Apply online; email CEFCU; call 309.633.3424 or 1.800.633.7077, ext. 33424; or visit a Member Center to get started.

  • How much money will I save by choosing a 15-year Home Loan rather than a 30-year Home Loan?

    A 15-year Fixed-Rate Loan gives you the ability to own your home free and clear in 15 years. While the monthly payments are higher than a 30-year loan, the interest rate on the 15-year mortgage is usually lower. More important — you'll pay less than half the total interest cost of the traditional 30-year mortgage. Many borrowers find the higher payment out of reach and choose a 30-year mortgage. It still makes sense to use a 30-year mortgage for most people.

  • Who should consider a 15-year Home Loan?

    The 15-year Fixed-Rate Loan is most popular among homebuyers with sufficient income to meet the higher monthly payments, and they want to quickly build equity or pay off the loan.

More FAQs