All about Mortgages

When looking for mortgage industry information, one of the most common questions visitors have is what types of mortgages are available. Here we'll explain the types of mortgages and which is right for you.

Fixed-Rate Mortgages

Fixed-rate mortgages are one of the most popular topics in mortgage industry information. The most common type of mortgage, fixed-rate mortgages can offer a consistent interest rate and monthly payment for the life of the loan. The most common loan term for this type of mortgage is 30 years, though other loan terms are available. In fact, fixed-rate mortgages can range from 15-40 years in their term. As you look into mortgage industry information, note that the longer your mortgage's term is, the more you will pay in interest over time. Conversely, the shorter the loan's term, the faster you will build equity in your home and the less money you will pay in interest. Most mortgage industry information experts recommend these types of loans if:

You have low risk tolerance
You plan to stay in your home for several years (five or more)
You believe interest rates are on the rise
Interest rates are at an all-time low and you want to lock in the rate
You want the ability to budget around a consistent monthly mortgage payment

Adjustable-Rate Mortgages (ARMs)

An adjustable-rate mortgage (ARM) means your interest rates will fluctuate periodically, and your monthly payments will change accordingly. The interest usually changes or "adjusts" at intervals of one, three, or five years. ARMs are tied to an index, like the Federal Reserve interest rate, that is an independently published rate that changes to reflect market conditions. Initially, ARMs can offer a lower initial rate than fixed-rate mortgages, but this rate is temporary. You may consider an ARM when looking into mortgage industry information if you expect interest rates to remain steady or decrease because it will then be less expensive over time than a fixed-rate mortgage. If you have any questions, please visit our FAQ page. Mortgage industry information experts recommend an ARM if you:

Plan to stay in your home less than three years
Believe interest rates are going to fall
Want the lowest possible interest rate initially
Are willing to tolerate the risk involved in rate and payment fluctuations