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Bio Statement Hummingbird Loans Fixed Vs. Adjustable Mortgage Loanhummingbird loans long term cash advance

Choosing between a fixed rate mortgage and an adjustable rate mortgage will be one of the most important decisions you make during the home hummingbird loans poor credit installment loans process! In this article we will explain both to you, so that you will have the knowledge to choose wisely.

So what are the differences between a fixed and adjustable rate mortgage? In simple terms, a fixed rate mortgage will lock in the interest rate in which you acquired at the time of the loan and remains the same throughout the life of your mortgage hummingbird loans long term cash advance. The stability factor alone is why so many people are choosing to go with the fixed rate mortgage option.

Now an adjustable rate mortgage, as the name implies can and will change over time, this type of mortgage loan will fluctuate and change over with interest rates. This type of mortgage hummingbird loans indian owned payday loans really benefits the lender, because the interest rate stays equal to the prevailing interest rates at any given time. For this reason you can get an adjustable rate mortgage that will offer lower monthly payments to begin with, so your initial mortgage payments will be much lower over the fixed rate mortgage, but beware, as the name implies, these rates can and will be adjusted and in the end you may lose out and end up paying much more in the long run as compared to someone with a fixed rate mortgage.

When looking at the above most people would consider it a no brainer and actually, in most cases, it is take a slightly higher payment, and live with it, because god knows interest rates will go up in the future. Why not right? The cost of living goes up every year, gas, bread and every other cost goes up from year to year, why not lock in a current rate and ride with it? Some on the other hand think well the rate is lower on the adjustable rate mortgage, that equals less money out of my pocket every month so..... Before choosing either or ask yourself this;

1. Can I afford to make larger mortgage payments if the rates go up in the future?

2. Do I really believe rates will stay the same or take a dive in the future?

3. Will I be moving out of my home in the next 5 years or so?

If you answered yes to these questions an adjustable rate mortgage will probably be your best choice.The adjustable rate mortgage is perfect for the person that is thinking short term, or is sure that rates are going to remain the same or decline in the future, but I have a word of advice for you people that think mortgage rates will not go up, take a look around, the price of living as well as every other aspect of day to day life rises by the year, what makes you think mortgage rates will not do the same? Sooner or later rates will jump, which is why I only recommend adjustable rate mortgages to people looking for short term benefits. The security of a fixed rate mortgage to a long term home owner is unbeatable, knowing that whatever the market does your mortgage payments will remain the same offers a piece of mind that cant be found in an adjustable rate mortgage.

So thats about it, the difference between a fixed and an adjustable rate mortgage is just that simple, although choosing which to go with is a very critical decision, the basis and concept of each is very simple. I really hope you make the right decision when choosing between the two, remember, in general, long term fixed rate mortgage, short term adjustable rate mortgage. Rolling the dice, adjustable rate mortgage, playing it safe, fixed rate mortgage.