Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

What is the difference between a Fixed Rate or Variable Rate?

April 26, 2017fixed rate

0

10 Posted

What is the difference between a Fixed Rate or Variable Rate?

1 Answer

0

10 Posted

Here are the differences: Fixed Rate Mortgage The mortgage rate stays the same for the whole term and the mortgage payments are consistent during the term of the mortgage. Variable Rate Mortgage The mortgage rate varies with fluctuations in the bank prime rate. As a result, mortgage payments may vary during the term of the mortgage. A minimum term commitment is often required (usually 3 years). You may have the option to “lock-in” the mortgage at a fixed rate during the term.