The Different Types of Mortgage Loans
Know your Financial Position
When opting for a mortgage loan, your financial position should be on top of your priority list. After gauging your financial situation, the next step is to know what kinds of mortgage loans are available in the market. Compare the different types, especially the maximum benefits you can get from them.
Types of Mortgage Loans
Below are the common types of mortgage loans available today:
Fixed Rate Mortgage
As the name suggests, the loan rate remains unchanged throughout the life of your mortgage. In other words, what you are paying every month will be the same throughout the course of your mortgage. The advantage of fixed mortgage rate is that your loan will not be affected by the sudden rise in the interest rates. It will be easy for you to organize your budget. The loan terms vary from one lender to another. Some offer 15 years, 20 years, 25 years, 30 years while others can offer up to 40 years. You just have to remember that the longer the term, the higher the interest rate will be.
Adjustable Rate Mortgages
This type of mortgage loan offers a flexible term and typically adjusts to the latest market trend. When the interest rates are low, then you can opt to modify your loan. The interest rates vary depending on the financial index of the current market. In other words, your monthly payment may go up and down. As a home buyer, you should be prepared in advance as you will be facing unsteady payments. You don’t have to worry though because you always have the option to resettle the terms or even refinance to get a much better deal.
The Federal Housing Loan is a secure and reliable type of mortgage loan. It benefits both the borrowers and the lenders. It is backed by the US Government, and so it is more convenient than the traditional loan. This is perfect for people with a not-so-good credit score and doesn’t have enough money for a down payment. It also has a low closing cost, small mortgage insurance, does not require a credit score, and comes with easy terms and conditions.
The Veterans Administration loan offers a low-cost insured home mortgage loan. It can be a big help whether you are buying a home for the first time or planning to refinance your mortgage. For you to be eligible for a VA loan, you should be a veteran, a surviving spouse, or a military-related individual. Some of the advantages of VA loan include credit flexibility, no down payment, competitive interest rate, low closing cost, and no mortgage insurance.
Learn more about Freedom Mortgage Corporation
If you are planning to buy a home or refinance your existing mortgage, then you should do your research well to find a mortgage lender that offers the most favorable deal. Freedom Mortgage Corporation is one of the names you can trust when it comes to mortgage lending. It offers different types of mortgage loans for first-time home buyers and to people who are planning to refinance their mortgage. It has been in the industry since 1990 and for more than 25 years it has successfully helped a lot of people in making their home ownership dream come true. The Better Business Bureau gave the company an A+ rating. This simply goes to show that the company is credible and highly reputable. Contact Freedom Mortgage now to find out your available options.
You may also check out Marco Kozlowski Toronto to get more ideas about mortgage loan.