Home Mortgages

The Home Mortgages are the traditional loans that have a fixed interest rate over the life of the loan, typically 30, 20, 15, or 10 years. With these loans, your monthly payment for interest and principal never changes (your escrow expenses, such as property taxes and insurance, may change from year to year). Down payments required on these loans can be as low as 5%. If you want predictable payments over the life of your loan and don't mind paying a bit more for this assurance, the fixed rate mortgage may be the best option for you. Such mortgages typically start at a lower interest rate (and lower payments) but interest rates and payments fluctuate depending on market interest rates. 

A Home Mortgages is adjusted annually (although some are adjusted more frequently). Increases are usually capped for any given year and for the life of the loan. For example, such loan might include an annual cap of two percentage points and a cap over the life of the loan of six percentage points. An ARM that starts out at 7.5% could increase to 9.5% in the second year, 11.5% in the third year, 13.5% in the fourth year, at which point it would be capped. These loans are popular with people who expect rising income over the next few years because they can buy more house on a lower current income, confident that their increasing income will make the higher payments affordable if the interest rates rise in subsequent years. 

If you know you'll be moving in five to seven years, and you'd like a lower interest rate but are uncomfortable with an adjustable rate, the Home Mortgages may be for you. These loans often have a somewhat lower interest rate than a conventional 30-year mortgage, but the loan is due in five to seven years. If you're still in the house at the end of the term, you'll have to find another mortgage in order to pay off the first one. This loan can be offered as a thirty-year, adjustable rate mortgage with zero points, with an interest rate below the rate of fixed rate mortgages and is locked in for at least the first five years. Interest rate caps will restrict the amount by which the rate can increase after the fixed portion of the loan is completed. 

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