Fixed-Rate Mortgages
Fixed-Rate Mortgages
A mortgage in which the interest rate remains constant during the entire term of the loan. This means that monthly payments for principal and interest are also fixed for the life of the loan. (Taxes, of course, may change.)
Advantages:
You can count on the same principal and interest payments for the life of the loan. Your rate won’t change, so you won’t have to worry about interest rate fluctuations like you would with adjustable-rate mortgages. A fixed-rate mortgage is a good choice if you’re likely to stay in your house for a long time.
Considerations:
Interest rates can be higher than adjustable-rate mortgages. Keep in mind that, on average, most people move or refinance within seven years. If current rates are high, you’re likely to get a better price with an adjustable-rate loan.
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