Common types of fixed rate mortgages:

The 15-Year Mortgage

• Save on Interest: A shorter loan term means you'll pay significantly less in interest over the life of the loan. For example, borrowing $100,000 at a 4% interest rate on a 15-year term can result in big savings compared to longer loans.

• Build Equity Faster: With more of your monthly payment going toward the principal, you’ll own your home outright in half the time.

• Higher Monthly Payments: Because the loan term is shorter, your monthly payments will likely be higher than with a 30-year loan. However, the potential savings on interest can make this option worthwhile.

The 30-Year Mortgage

• More Interest Over Time: A longer loan term means you’ll pay more in interest overall, as payments are spread out over three decades.

• Lower Monthly Payments: Spreading payments over 30 years typically results in lower monthly payments, which can be helpful if you’re working within a tighter budget.

• Flexibility: The 30-year term remains a popular choice for its affordability and the flexibility it offers homeowners.

How It Works

With a fixed rate mortgage:

• Your Rate Stays the Same: Lock in a consistent interest rate that won’t increase, even if market rates go up.

• Predictable Monthly Payments: Payments are based on your loan amount, interest rate, and a fixed amortization schedule. Your payment remains steady for the entire term of the loan.

• No Prepayment Penalties: Pay off your mortgage early without worrying about extra fees.

Why Choose a Fixed Rate Mortgage?

A fixed rate mortgage offers stability and predictability, making it easier to plan your finances. Whether you prefer the long-term affordability of a 30-year loan or the quicker payoff of a 15-year term, you’ll enjoy the reassurance of knowing your payment amount will never change.

Have questions? Give us a call! One of our mortgage specialists would be happy to speak with you about your loan options.