The most basic home loan is a fixed rate mortgage. It is what it advertises; a fixed rate and payment for the life of the loan. So whether it is 2 years or 10 years into the loan the mortgage payment and rate will still be the same.
They are available in 10, 15, 20, 25 and 30 year periods. The most popular are 30 and 15 year loans. Years ago your parents or grandparents would take out a 30 year loan to purchase their home and keep it for the remainder of the loan term. Times have changed, with the increase in property values and decrease in the long term fixed rates many people have refinanced more than once over the past few years.
However the majority of homeowners continue to use the fixed rate mortgages even with the advent of the ARMs and Pay Option ARM loans, that carry lower rates but for a shorter period of time. Borrowers want to feel comfortable with their mortgage payments and know that they will not change based on an index.
In conclusion if you plan on spending ten or more years at your home a fixed rate mortgage is the right loan for you. If you currently have an ARM and the rate and payment are soon to adjust complete an application to get a personalized mortgage quote.
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The most basic home loan is a fixed rate mortgage. It is what it advertises; a fixed rate and payment for the life of the loan. So whether it is 2 years or 10 years into the loan the mortgage payment and rate will still be the same.
They are available in 10, 15, 20, 25 and 30 year periods. The most popular are 30 and 15 year loans. Years ago your parents or grandparents would take out a 30 year loan to purchase their home and keep it for the remainder of the loan term. Times have changed, with the increase in property values and decrease in the long term fixed rates many people have refinanced more than once over the past few years.
However the majority of homeowners continue to use the fixed rate mortgages even with the advent of the ARMs and Pay Option ARM loans, that carry lower rates but for a shorter period of time. Borrowers want to feel comfortable with their mortgage payments and know that they will not change based on an index.
In conclusion if you plan on spending ten or more years at your home a fixed rate mortgage is the right loan for you. If you currently have an ARM and the rate and payment are soon to adjust complete an application to get a personalized mortgage quote.