On a traditional residential real estate first mortgage loan, 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. However, within these two broad categories there are variations. Such as: Balloon Note Mortgages: This type of fixed rate has a call feature, that is, your mortgage payments may be amortized over a longer period like 30 years, yet the loan is due and payable long before the 30 years is up. The principal balance of the loan must be paid off or refinanced. This is common when lenders wish not to commit funds for a long period of time. Typically the consumer realizes improved interest rates by accepting a balloon note mortgage, and also has short term needs. Fixed then ARMS: This type of fixed rate allows a consumer to secure a fixed rate for a specified term before it roles into an adjustable rate mortgage. This type of 30 year loan may offer a fixed rate, bel
