fixed rate home loan

Fixed Rate Home Loan

Fixed-rate mortgages allow for repayment of a debt in equal monthly mortgage payments over a specified period of time, from 10 to 50 years. A 30-year amortization period is typically most common.

• Payments are credited first to interest, then to principal, so the beginning of your loan period the majority of the payment goes toward interest.
• Toward the end of the loan period, much of the monthly payment goes toward principal.

The Benefits of Fixed-Rate Loans

Some borrowers  prefer fixed-rate mortgages because they like the peace of mind in knowing exactly how much they will pay per month for principal and interest.

• The interest rate is fixed, so if overall interest rates increase, it does not affect the fixed-rate borrower.
• If interest rates increase, the borrower can refinance the mortgage into a lower rate.