A fixed rate mortgage is a mortgage in which the interest rate charged remains fixed for the entire term of the loan, no matter what happens with the interest rates. With a fixed rate mortgage, the payment does not change during the life of the mortgage. Whether the fixed rate is the best for you depends on a number of factors.
If you opt for a fixed-rate mortgage, your rate will be based on the prevailing market interest rate, plus or minus a spread. Many borrowers want a fixed-rate mortgage when interest rates are low but may increase in the foreseeable future. This ensures a relatively low payment compared to what could have happened if the rate increased significantly. On the other hand, if the rates are higher but may fall in the foreseeable future, a variable rate may result in paying less. Depending on the terms of your contract, your interest rate on the new loan will remain fixed, even if interest rates go up to higher levels. On the other hand, if interest rates are in decline, then it would be better to have a variable rate loan. As interest rates go down, so will the interest you pay.
Instead of worrying about the best type of mortgage for you, give us a call. We make it my business to provide our customers with the information they need to make the best decision for their situation.
An adjustable rate mortgage, also known as ARM, is a loan with an interest rate that can change periodically. With ARM, monthly payments can go up or down. Many borrowers choose ARM because the monthly payment is usually lower than with a fixed-rate loan. The potential disadvantage of this is that the rate can change unexpectedly. In some cases, the monthly payment goes down. Some borrowers who choose an ARM then refinance for a fixed rate if interest rates begin to rise. This allows them to connect at a specific rate, while they have still benefited from the lower payment that ARMs make possible.
If you have questions about the best loan for your situation, we will provide assistance to the patient.
A refinance is the process of replacing an existing loan with a new loan. Many borrowers refinance with their existing lender, while others refinance with a new lender. Many people refinance to reduce their payment if interest rates have gone down, or to withdraw money from their home if they have accumulated equity. The money withdrawn can be used to pay bills, renovate the house, pay for education, or practically anything else.
In some circumstances, borrowers refinance to take out money and reduce their payment at the same time. This is possible if the borrower has had his existing loan for a prolonged period of time and when the interest rates are low.
Refinancing is an attractive provision that comes with home ownership.
An FHA mortgage is a mortgage issued by a federally qualified lender insured by the Federal Housing Administration (FHA). FHA mortgages are designed for low to moderate income borrowers who cannot afford a large down payment.
The percentage of the home’s value for FHA mortgages is adjusted from time to time, as is the amount of the down payment that is allowed to be provided by gift or grant funds. But these amounts are at levels that are generally attractive and intended to assist first-time buyers, low to moderate income buyers, and others with less than perfect credit.
The higher the borrower’s credit score, the lower the initial payment that is requirement for an FHA loan.
If you have questions about the best loan for your situation, LoanGroup is ready to help.
A VA mortgage is a mortgage option that is available to veterans of the United States, current service members and spouses who have not remarried. VA loans are issued by qualified and guaranteed lenders by the Department of Veterans Affairs of the United States (VA).
In the United States, jumbo mortgages exist for buyers that need a mortgage above conventional loan limits. Conventional loan limits vary from state to state. To qualify for a jumbo mortgage, the borrowers generally must have high credit quality.
If you are looking for a Jumbo loan, LoanGroup can help.
