Aren there really just two kinds of mortgages: fixed and adjustable rate?
You could say that, because all mortgages fall into one of these two categories — that is, the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage. Fixed-Rate Mortgages With this type of mortgage your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments will be very stable. Fixed-rate mortgages are available for 30 years, 25 years, 20 years, 15 years and even 10 years. We can also show you specifically how much extra to pay in order to payoff your loan early. Adjustable-Rate Mortgages (ARMS) These loans generally begin with an interest rate that is 2-3 percent below a comparable fixed rate mortgage, and could allow you to buy a more expensive home.
All mortgages fall into one of these two categories the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage. With a fixed-rate mortgage, your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments remain the same. ARMs usually begin with an interest rate that is below a comparable fixed rate-mortgage. However, the interest rate changes at specified intervals depending on changing market conditions; if interest rates go up, your monthly payment will go up, too. If rates go down, your mortgage payment will also drop. There are also mortgages that combine aspects of both types of loans starting at a low fixed-rate, for example, then adjusting to market conditions.
You could say that, because all mortgages fall into one of these two categories — that is, the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage. Fixed-Rate Mortgages With this type of mortgage your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments will be very stable. Fixed-rate mortgages are available for 30 years, 20 years, 15 years and even 10 years. There are also “bi-weekly” mortgages, which shorten the loan by calling for half the monthly payment every two weeks. (Since there are 52 weeks in a year, you make 26 payments, or 13 “months” worth, every year.) Adjustable-Rate Mortgages (ARMS) These loans generally begin with an interest rate that is 2-3 percent below a comparable fixed rate mortgage, and could allow you to buy a more expensive home.
You could say that, because all mortgages fall into one of these two categories — that is, the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage. Fixed-Rate Mortgages With this type of mortgage your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments will be very stable. Fixed-rate mortgages are available for 30 years, 20 years, 15 years and even 10 years. There are also “bi-weekly” mortgages, which shorten the loan by calling for half the monthly payment every two weeks. (Since there are 52 weeks in a year, you make 26 payments, or 13 “months” worth, every year.) Adjustable-Rate Mortgages (ARMS) These loans generally have an initial interest rate that is lower than a comparable fixed rate mortgage, and could allow you to buy a more expensive home.
A You could say that, because all mortgages fall into one of these two categories; that is, the interest rate you pay is either the same (fixed) for the life of the mortgage, or it can change (adjust) over the life of the mortgage (see Mortgage Tips & FAQ’s). But within these two broad categories, there are many different kinds of mortgages designed to fit people in different financial situations and many of them are especially for first time home buyers (see Help for First Time Home Buyers).
