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A fixed rate mortgage means that the interest rate remains the same for the entire term of the loan, which means that the payment remains the same throughout. As the term of the loan continues, the home owner hopefully will find that his/her income increases and that the mortgage payment, which has not fluctuated, becomes a bit easier to manage. The payment on an adjustable rate mortgage is subject to change. The payment will remain the same for the term of the first period, prior to the first adjustment. But then, if rates go up, the mortgage rate will increase, thus increasing the payment, sometimes to a level that is beyond the reach of the home owner. ARMs were a huge problem for many home owners around 2007 and forward, which contributed to the collapse of the mortgage industry (especially since many of these borrowers were not qualified in the first place). While an ARM could result in a decrease of the interest rate, it is a gamble for most people. A few points of interest could double a house payment, making it impossible for many people. If you don't understand mortgage terms, you can educate yourself. There are several reputable website, a number of good books and you can always rely on your real estate professional to explain things. Have a look at this website: http://www.mortgage101.com/
What else can I help you with?
When is mortgage refinancing not a good idea?
Mortgage refinancing is not a good idea when you have had your mortgage for a long period of time.
Where can I get a good fixed mortgage?
The best way to find a good, fixed mortgage is to apply with your local bank. You can also try lendingtree.com. They will match you with the lowest mortgage rate possible.
Is a 10 year adjustable rate mortgage (ARM) a good idea for me?
A 10-year adjustable rate mortgage (ARM) may be a good idea if you plan to sell or refinance before the rate adjusts. However, if you plan to stay in the home long-term, a fixed-rate mortgage may provide more stability and predictability in your payments.
Is an ARM mortgage a good idea in 2022?
An ARM mortgage may not be a good idea in 2022 due to potential interest rate increases.
What are some good online mortgage quotes?
Presently it appears that a good online quote for a 30 year fixed mortgage would be 3.2%. One can obtain a 15 year fixed mortgage at 2.2% from some online lenders if one has a good credit rating.
Fixed Rate Mortgage vs. Interest Only Mortgage?
Fixed Rate Mortgage vs. Interest Only Mortgage A fixed rate mortgage has the same payment for the entire term of the loan. Use this calculator to compare a fixed rate mortgage to Interest Only Mortgage.
What type of mortgage loan has a fixed rate a fixed term and a fixed payment?
Conventional Mortgage
What are the current mortgage fixed rates?
The current mortgage fixed rates depend on which bank your mortgage is with and how long your mortgage is for. A Wells Fargo 30 year mortgage is 3.75%.
What is the difference between a fixed second mortgage and one with a variable rate?
The difference between a fixed second mortgage and one with a variable rate is that fixed second mortgage has a fixed rate and is commonly thought of as safer than a mortgage with a variable rate.
What are the current mortgage rates for a 30 year fixed in Dallas?
Current mortgage rates for a 30 year fixed in Dallas would be about $ 600.00 a month. If you are in good standing and have credit payments may be less.
Are fixed rate mortgages a good deal?
Fixed rate mortgages allow you to lock in a fixed rate for the life of the mortgage loan. This compares to adjustable rate mortgages where the rate may change. By getting a fixed rate mortgage you protect yourself from future spikes in interest rates.
What describes how a fixed-rate mortgage works?
The monthly payment on a fixed-rate mortgage never changes.
