Purchasing a home can seem overwhelming, with so many options and industry jargon. Take a few minutes to understand the various types of home loans so you can move forward with confidence. Our mortgage rates calculator will provide you with rates and loan types for your situation. Fixed Loans: A Fixed loan has an interest rate that does not change for the duration of the loan, so your mortgage principal and interest payments stay the [...]
Mortgage rates are driven by movements in the financial markets around the world. When the economy is going strong, bond prices drop, and rates increase. Conversely, when the economy retreats, interest rates will tend to fall. View current mortgage rates for fixed-rate, FHA, and Jumbo mortgages and get custom rates.
There are numerous types of ARM loans, with the most popular having a fixed term for a specified number of years (such as 5, 7, or 10 years) and can then be adjusted each year thereafter, up or down. These types of ARMs are referred to as 5/1 ARM, 7/1 ARM, 10/1 ARM, etc.
A Fixed loan has an interest rate that does not change for the duration of the loan, so your mortgage principal and interest payments stay the same. Whereas, with an adjustable rate mortgage (ARM) the interest rates are typically fixed for a specified number of years (5, 7, or 10 years) and can vary up or down after that period, based on an index.
Closing costs are fees paid at the closing of a real estate transaction when you’re buying or refinancing a home. This point in time called the closing is when the title to the property is conveyed to the buyer. Closing costs are the expenses, over and above the price of the property, that buyers and sellers normally incur to complete a real estate transaction. Typically, the buyer's costs include underwriting, appraisal fees, mortgage insurance, homeowner's [...]
Points represent any loan discount points sometimes charged to lower the interest rate.
PMI is Private Mortgage Insurance. On a conventional loan (Fixed, ARM), PMI is required if you borrow over 80% of your appraised value or purchase price (whichever is lower). This protects the lender against financial loss if the loan is defaulted.
Yes, you can make principal payments at any time during your loan term or pay the loan in full. You can also pay a set amount each month above the normal payment due or make lump-sum payments periodically.
A conventional loan is the most common type of home loan. The requirements to qualify are more stringent than FHA as the lender will want to make sure you are a good credit risk since this type of loan is not backed by a government agency. Benefits include lower interest rate, less paperwork, easier to pass home inspection, and you can avoid paying personal mortgage insurance (PMI) if your down payment is large enough. An [...]