Loan Intermediaries & Mortgage Intermediaries

There are many types of home mortgage loans available today,
so in order to choose the one that’s right for you, you
need to know the differences.

The two most common mortgage loan types are fixed rate and
adjustable rate. Here’s a quick rundown of both:

An Adjustable Rate Mortgage (ARM) is where the interest
rate fluctuates during the life of the loan. The borrower
benefits if interest rates fall, but loses out if interest
rates rise.

Normally an Adjustable Rate Mortgage loan will be fixed at
a low rate for the first year or two. Then after that time
period the rate will vary every 6 to 12 months. Once this
adjustment period begins, the rate can climb much higher
than a fixed rate mortgage, and you can find yourself in
big financial trouble if this happens.

A Fixed Rate Mortgage, unlike an ARM, has a steady interest
rate for the entire life of the loan, usually 30 years.
This type of rate is perfect for those who like to budget
their monthly expenses and who plan to keep their home for
a number of years.

There are advantages and disadvantages to each type of
loan, so it’s best to discuss your personal financial
situation with your mortgage lender and get his/her advice
about which is best for you.

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