QandAs: Loans

What is a Fixed-Rate Mortgage Loan?

Answer:
The interest rate on a fixed-rate mortgage will

never change. It is locked in for the life of the loan, no matter how much interest rates may increase over the life of it.

Therefore, your payment is always the same. You may find it more difficult to qualify for a fixed-rate loan, and the rate itself is usually slightly higher than the initial rate on adjustable-rate mortgages. Even so, you will likely pay far less interest in the long run and you don’t have to worry about your payments going up in the future. All-in-all, a fixed rate mortgage is less risky than an ARM or Interest Only mortgage.

A fixed-rate mortgage loan is a great option for those that will own or live in a home for the term of the loan as after the term is up the loan is paid off you own 100% equity in the home.

Fixed rate mortgages come in a variety of different terms. The most common fixed mortgage is a 30 Year Fixed Rate Mortgage . So once you "lock in" your mortgage rate before closing, this is the rate you will have for the next 30 years. Fixed rate mortgages also come in 5, 10, 15, 20, 40 and I've even seen advertisements for a 50 year term.

For a free fixed rate mortgage quote click here.


	more Q&A sessions like this
	What is a conventional mortgage loan? What are the benefits of a fixed rate mortgage? What are the cons of a Fixed Rate Mortgage? ARM or Fixed Rate Mortgage Loan? What are the different types of Mortgages? What are the most common terms for a Fixed Rate Mortgage? What do mortgage lenders look for when figuring fixed mortgage rates? What is a 30 Year Fixed Rate Mortgage Loan? What are the cons of an Interest Only mortgage loan? What is a VA Mortgage?