If you aren’t acquainted with the difference between fixed-rate and adjustable-rate loans, you should do some homework before you sign on the dotted line. There is no way to predict when or how much interest rates will change (they can increase or decrease). This can greatly affect the type of loan that best suits your situation.
Fixed-rate loans are generally a smart option for many qualified homebuyers under the following circumstances: 1) You anticipate living in your new home for some time, usually five years or more; or, 2) You desire the certainty of a monthly mortgage payment that does not fluctuate.
Adjustable Rate Mortgage (ARM) is a loan that permits the lender to adjust its interest rate periodically based on changes in a specified index. It’s common to receive a low introductory mortgage rate for the first few years of an adjustable rate loan.
If you have any questions regarding the benefits of various mortgage options, feel free to contact us and we'll be happy to explain further.
Remember, if you have questions about moving, building, selecting your first home or moving up to your next home, contact DAVID BRENTON’S TEAM.
When you are serious about moving… put our TEAM to work for you!
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