To choose the right mortgage loan, it’s important to understand the “fixed rate mortgage” definition. This type of loan has several advantages, including predictable monthly payments and long repayment terms. However, a fixed rate mortgage might not be right for everyone.
Here is a quick guide to understanding this type of mortgage:
When comparing mortgages, you’ll encounter fixed rate mortgages and adjustable rate mortgages. As the name suggests, the interest rate of an ARM adjusts with market fluctuations, but the loans are offered at low introductory rates for a limited time period.
ARMs usually have introductory rates lasting anywhere from one to five years. Once the introductory period ends, your interest rate will increase with a cap of to 2% per year, or 5% over the lifetime of the loan.
Compared to fixed rate mortgages, ARMs are more complex loan programs and typically better for borrowers who have less intention of staying in the same home for an extended period of time.
Fixed-rate loans are incredibly affordable because of the predictable nature of their repayments. While the homeowners coverage and taxes may vary, your mortgage payment will remain the same. This affects your budget for the rest of your month, and plays a major part in your financial planning.
Besides reducing the risk of default on fixed-rate loans, your loan rate remains constant. Whatever your rate is, the amount you paid will remain unchanged when you took the loan. Often, these rates are higher than they would be for an ARM.
Fixed-rate mortgages can be repaid during a predetermined amount of time. They are usually offered as 30-year home loans, giving you a maximum of 30 years to pay the full amount.
This may seem like a long time, but the extended timeline is one thing that ensures a lower monthly mortgage payment.
There are other options available, such as a 15-year mortgage. These can work well if the borrower has sufficient cash to pay the loan more quickly while still taking advantage of the fixed interest rate.
“I sell your home like it's mine”
A licensed real estate salesperson since 2016, Rob is affiliated with the Briarcliff Manor office of Corcoran Legends Realty. He serves buyers, sellers, renters, in Westchester, Rockland, and Putnam counties. Rob, a native of New York and Westchester County for most of his life, brings an extensive local knowledge of both residential and commercial properties to the table. His experience includes a wide range of property types – single-family, multi-family, condos and mixed use. “Hard to sell” properties is where Rob really excels. “There’s no problem that cannot be solved.”
Rob is certified for many different disciplines in real estate. Cartus Relocation Network Agent, AARP Agent, National Tenants Network (NTN) Agent, Green certified and Pricing Strategies Master. In addition, Rob has completed the Leader’s Edge Advanced training to better serve his clients. Rob has been both associate of the month and top closed dollar agent.
When you work with Rob, you get the feeling you’re his only client. Numbers don’t count, you do. Clients always come first. Each transaction is handled as if it were his own home. Rob strives to make the process as seamless as possible and takes care of all the details, no matter how small. His clients rave about his above-and-beyond service and prompt informative communication. Rob is easy going, friendly, and patient. However he can be a determined and aggressive negotiator when the need arises.
When not out actively working on behalf of his clients, Rob spends time with his wife and two teenage daughters. A devoted supporter of community he sits on several local boards and volunteers for numerous locale nonprofit organizations. He enjoys cycling, hiking, kayaking and winter skiing.
“May your price be right, and your sale be swift!”