10/22/2024
There is more to rates than just numbers. You can choose between a “fixed rate” and “adjustable rate” mortgage. Which one is best for your situation will depend on how long you intend to occupy your current home.
Fixed: The payment stays the same for the duration of the loan. If you intend to stay in the same place for the life of the loan, you may be better off with a fixed rate mortgage because you will be protected against rate increases.
Adjustable: For three, five or seven years, the rate remains fixed. Then it fluctuates based on market interest rates. You will not be protected from market fluctuations after that, but the rate for the initial fixed term is usually lower. So, if you think you will be moving on to a new home after a few years, an adjustable rate may be your best bet.
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