What is an intermediate fixed rate mortgage?
An intermediate fixed is a mortgage with a fixed rate for the first few years, which then becomes either an adjustable or has a balloon payment. The fixed period is typically 3,5,7,10 years. These loans are recommended for borrowers who plan to move within the fixed period or when interest rates are high and you expect them to come down. Always consult with your loan advisor before recommending one of these loans and be sure to emphasize what happens to the loan after the initial fixed period.
