ING DIRECT Easy Orange

ING DIRECT is my new favorite bank.  It’s an online-only bank, and that suits me just fine, I prefer banking online.  Allows them to offer savings accounts at rates 4X the national average.  Their website makes saving money really straightforward, money transfers are free, and lots of other nice features.  I recently wrote a short review for ING’s savings accounts.

This post is about ING DIRECT’s unique Easy Orange Mortgage.  I’ve had this mortgage for 6 months now and am quite pleased.  They are conservative about who they lend to, so if you don’t have good credit or don’t have 25% down payment / equity in the home, don’t bother.  They are conservative so they can pass the savings on to you, in the form of a very low interest rate, easily a full 1.00% less than the average 30-yr mortgage, and significantly lower rate than most 5-yr ARMs as well.

The mortgage is sort of a hybrid between a 5-yr ARM and a 30-yr fixed mortgage. Similar to a balloon/reset mortgage, for those who know what that is. Here’s the skinny (as of this posting):

The Easy Orange Mortgage

• Low Rates – You get a low 5-year fixed rate with payments that are based on repaying over 30 years.
• Rate Renew – No need to refinance and pay full closing costs. You can relock your rate and extend your fixed rate period for another 5 years at the Easy Orange rate offered at that time – all for one payment which is equal to 2 of your bi-weekly payments (maximum payment of $2,500).
• Self Service = Low Cost – We can offer low rates by keeping our costs low. So we ask for a little help from you. All applications are done quick and easy on ingdirect.com and all payments are done electronically. You’ll save money, we’ll save some trees in the process.
• Low Closing Costs – Unlike other banks, we don’t charge application fees or points.
• Bi-weekly Payments – You make electronic payments every two weeks instead of once a month. By doing so, you’ll pay your mortgage off sooner than 30 years.

Just a few comments about my own experience with this mortgage.  ING DIRECT had their act together at the closing.  Everything went as planned.  I had a lot of questions as I prepared for this mortgage, and phone support throughout the process was great.  I spent very little (typically none) time on hold, and the associates on the phone were friendly and knowledgeable.  And every time I spoke with someone who clearly spoke and understood English… you have no idea how nice this is, and how much faster a support phone call can be with someone who understands what you’re talking about the first time.  Probably the best phone support experience I’ve ever had.  Granted, other companies have set a pretty low bar.

Cons: there is one thing I don’t like about this mortgage compared to most other lenders.  They don’t escrow.  That means you pay the property/school tax bills yourself.  I imagine it is all part of keeping their costs low?  It is a bit inconvenient, but isn’t a big problem for me to write a few checks a year on my own.

You really should check out the Easy Orange mortgage at ING DIRECT to get more details and see if it is right for you.  If not, they do have other, more standard ARM mortgages available, and fantastic savings accounts. You can click on the above banner to begin an ING DIRECT savings account, then click here to get details on the Easy Orange Mortgage.

Update (Feb. 2010):  In January, ING’s mortgage rates dropped 0.5% since my mortgage began, so I paid to do the rate renew.  The cost to renew at the lower rate was 2 bi-weekly payments (basically 1 month’s payment), but I did the math, and with 0.5% lower rate, I will save much more than that over the 5 years.  I was a bit nervous because before I put the paperwork in the mail, the rate went up a bit, but they stayed honest and everything went smoothly as expected.

Update (July 2010):  By the way, use this promo link to open a new savings account with ING DIRECT, and you can earn $25. Just open it with a minimum of $250. That’s an instant 10% return! You’re welcome!