Welcome to Home Mortgages
Home Mortgage Wilmington Article
This is a selection made from among articles on Home Mortgage Wilmington. For a permanent link to this article, or to bookmark it for future reading, click here.
Home Mortgage Loans - Fixed Rate, Adjustable or Balloon, Which One Is Right For You?
from: Carrie ReederWhen you're shopping for a new home—especially for the first time—all the terms and expressions may be confusing and difficult to understand. Adjustable rate, fixed rate, balloon payment - how do you decide which is the right type of home mortgage for you if you're not even sure what each of them are?
The name of the mortgage type usually has to do with how you'll pay for your loan - how the interest on the loan is being determined by the bank. The three major types of mortgages are fixed rate, adjustable rate and balloon payment. Each has advantages and disadvantages.
Fixed Rate Mortgage
With a fixed rate mortgage, you have a set interest rate for the entire life of the loan. The interest rate that you pay for your loan won't change - which means that you'll pay the same monthly payment for the entire length of the loan. This protects you from unexpected rises in interest rates that would increase your monthly payment. At the same time, should the interest rates drop, you will have the option of refinancing at a lower interest rate. Because the protections are largely on the side of the buyer with a fixed rate mortgage, interest rates on them are generally slightly higher than they would be on other types of mortgages.
A fixed rate mortgage is the safest type. Because the payments are predictable, it’s usually considered the most desirable type of mortgage. Always choose a fixed rate mortgage if interest rates are rising.
Adjustable Rate Mortgage
When you choose an adjustable rate mortgage, your monthly payment and interest rate will fluctuate with the current market interest rate. If the interest rate goes up, so will your monthly payment. If it drops, your monthly loan payment will as well. The adjustable rate is tied to an index, which is determined by the lender. Other terms of the mortgage are also determined by the lender. These include how often the interest rate is adjusted - anywhere from every 3-6 months to once a year, how much the interest rate can increase or decrease on any adjustment date, and whether there is a 'cap' on how high the interest rate can rise.
Often, adjustable rate mortgages are advertised with extremely low interest rates, which will be in effect for a short period of time. When the introductory period is over, the mortgage rate will rise to its normal amount.
Choose an adjustable rate mortgage when you have secure income that is likely to increase along with the economy. It's a good mortgage when interest rates are stable, or if the signs suggest that they're about to fall.
Balloon Mortgages
A balloon mortgage is often a last resort for home buyers who can't qualify for more traditional loans. The balloon mortgage has a fixed interest rate and monthly payments for a specific amount of time. At the end of that time, the entire loan comes due - hence the name 'balloon'. In practical terms, a balloon rate will give you a fixed monthly payment for several months. After that, you'll essentially have an adjustable rate mortgage.
Choose a balloon mortgage loan for substantially lower initial rates, or if your credit limits the other types of mortgage that you can apply of qualify for.
Now that you understand your options for mortgage loans, don’t forget to shop around! The interest rates and fees can vary wildly from lender to lender, so make sure that you get the best deal that you can!
About the Author
Carrie Reeder is the owner of ABC Loan Guide, an informational website about various types of loans. The site has informative articles and the latest finance news.
Home Mortgage Wilmington Specific links
Watch Free Videos At Mevio!
- Tons of Free Videos, Only At Mevio.com
-- http://www.mevio.com/
Learn How To Stay Young and Feel Great
- Free Advice For Boomers From Experts Around the Country
-- http://www.boomj.com/
The fastest and easiest way to chat with anyone.
- Chat with anyone, anywhere, anytime with Utterz.
-- http://www.utterz.com/
American Idol Gets Fourth Judge
- One of the fastest growing sites on the net, and yea, theres a reason
-- http://www.holytaco.com/
Car-Parazzi
- If you love cars, join the Car-parazzi. And if someone car-parazzi's you... smile and rev, it means you've got a hot car!
-- http://www.car-parazzi.com/
Home Mortgage Wilmington News
American Home says unsecured creditors will get virtually nothing - International Herald Tribune
American Home says unsecured creditors will get virtually nothing International Herald Tribune, France - NEW YORK: American Home Mortgage Investment, which was among the largest US providers of home loans before seeking bankruptcy-law protection a year ago, ... American Home to pay fraction of bankruptcy claims Bankrupt AHM to repay some creditors 5.9% of debt A Sad Forecast for American Home Holders |
Day 3 in Denver: Michelle Obama, Senator Joe Biden Host Economic ... - MarketWatch
 PinkNews.co.uk | Day 3 in Denver: Michelle Obama, Senator Joe Biden Host Economic ... MarketWatch - And every night for the 35 years that he's been a Senator, Joe takes an Amtrak train from Washington back to Wilmington to be with his family. ... OUR VIEW: Working families will decide this election |
Wilmington-area home sale prices drop in July - StarNewsOnline.com
Wilmington-area home sale prices drop in July StarNewsOnline.com, NC - Home sales rose in July to 507 from 441 in June, according to data from the Wilmington Regional Association of Realtors, whose multiple listing service ... |
These Two Battleground States Hold The Key To Success In November ... - National Journal
These Two Battleground States Hold The Key To Success In November ... National Journal, DC - The mortgage crisis and the continuing loss of industrial jobs -- a toilet-bowl factory shut down in Tiffin, while 8200 positions were eliminated last week ... |
Obama's pick Joe Biden: A profile - Gainesville Sun
 Aljazeera.net | Obama's pick Joe Biden: A profile Gainesville Sun, FL - Biden has commuted for years between Washington and Wilmington, Del., so he is home every night. He is famously close to his family. ... Corporate leaning |
1st Reverse Financial Services Continues Wholesale Expansion With ... - FOXBusiness
1st Reverse Financial Services Continues Wholesale Expansion With ... FOXBusiness - Reverse mortgage loans allow homeowners to access the equity in their home without the requirement of a monthly payment and borrowers have the flexibility ... |
Pat Holsten Selected to Head American Security Mortgage Expansion ... - Carolina Newswire (press release)
Pat Holsten Selected to Head American Security Mortgage Expansion ... Carolina Newswire (press release), NC - CHARLOTTE & WILMINGTON, NC – Philip Mahoney, President and CEO of American Security Mortgage Corporation, announced that Patricia Holsten, former CEO of ... |
Obama names Biden as running mate - Sunday Business Post
Obama names Biden as running mate Sunday Business Post, Ireland - Biden still commutes each day by train from his home in Wilmington, Delaware to Washington. He was fancied as a serious contender for the Democratic Party’s ... |
Less than zero: Lots of Detroit properties worth even less than $1 ... - WalletPop
Less than zero: Lots of Detroit properties worth even less than $1 ... WalletPop, VA - I took one of them 30 years ago from the city of Wilmington, Del., in return for agreeing to fix it up and live in it for three years. ... |
PhillyDeals: PhillyDeals: What kind of a VP would Biden make? - Philadelphia Inquirer
PhillyDeals: PhillyDeals: What kind of a VP would Biden make? Philadelphia Inquirer, PA - Biden may be lucky his Wilmington banker friends were in credit cards, not home loans. Bankers from Wall Street to Main Street are known for keeping lists ... |