Fixed Rate Refinance Loans
Searching for consistency in your finances? Planning to buy a home for the long-run? Before selecting a loan type, it’s important to consider how long you plan to live in the home. For example, if you’re planning to live in the home long-term, a fixed rate mortgage may be a better option.
What’s a Fixed Rate Mortgage?
With a fixed rate mortgage, your interest rate and payments remain the same throughout the duration of your loan. Since you are locked into your interest rate, you’ll be unaffected despite any increases in market rates. Fixed rate loans also provide you with the opportunity to refinance your mortgage if the market rates happen to decrease.
You must have sufficient income and credit history to qualify for a fixed rate mortgage.
Pros And Cons
Explore the benefits and the drawbacks to fixed rate mortgages by expanding each section below.
- Interest rates are set and won’t change.
- Your monthly payment won’t change.
- You’ll be protected from rate increases.
- You may be able to refinance if market rates decrease.
- Your initial interest rate may be higher than an ARM.
- Your mortgage payments may be higher than an ARM.
- Your interest rate won’t automatically lower if market rates decrease.
How long you plan to live in the home is important. For example, if you’re planning to live in the home long-term, a fixed rate mortgage may be a better option.