What is the difference between a fixed-rate loan and an adjustable-rate loan?
With a fixed-rate mortgage loan the interest rate and monthly payment of principal and interest for the duration of the loan. With an adjustable-rate mortgage, the interest rate stays fixed for an initial time period, which ranges from 1 to 7 years, and then may change periodically, usually on an annual basis.
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan may change depending on the program. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to me.
A.: With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to us.
With a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an adjustable-rate mortgage (ARM), the interest changes periodically, typically in relation to an index. While the monthly payments that you make with a fixed-rate mortgage are relatively stable, payments on an ARM loan will likely change. There are advantages and disadvantages to each type of mortgage, and the best way to select a loan product is by talking to your broker.
With a fixed rate loan, the interest rate stays the same throughout the term of your loan. With an adjustable rate loan, the interest rate on your loan will change after a specific period of time. There are advantages to each type of loan and it’s best to contact a mortgage professional so they can find out what makes the most sense for you.
