Tips About Fix Rate Mortgage
July 8 | Filed under Finance | 
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Many couples buying a home are face with the question of whether to opt for a 15 or 30 year fixed mortgage rate. No-one wants a mortgage hanging around their neck forever but with home buyers entering the market later, an early repayment of this loan is important. Take some time to think about everything carefully before any agreement is signed. Home buyers looking into this need to be assured their monthly payments will not increase.
If you are offered a deal that appears to be too good to be true than it probably is. The interest rate should remain the same for fixed rate mortgages until the loan is repaid. There are no hidden costs involved with this type of plan which is great for many people that want a regular monthly payment. When my wife and I were looking at homes for sale we decided to check out the various loans available with 15 year fixed mortgage rates.
Our aim was to pay of the mortgage as soon as we could without getting into trouble with high monthly payments. So in consideration of this point we also looked at longer, 30 year fixed rate mortgages as well. Still, having a mortgage close to retirement wasn’t what we were looking for, so we decided to try for a loan with a 15 year fixed mortgage. Too much pressure was placed on the early repayment of the mortgage loan.
After careful consideration we decided to take the longer term 30 year repayment option instead of the 15 year plan. Reaching the decision we did was the only one that made sense. Probably the over-riding decider was the fact my wife was expecting a child. Her regular monthly income would become unreliable because she wanted to be at home raising our child. The downside to the 15 year fixed mortgage rate was the higher monthly repayment. All things considered, we just didn’t want to bite off more than we could chew. We found that the monthly repayments on a 30 year loan were more manageable.
Being able to make additional lump sum payments during the year means the outstanding loan reduces faster. We also found that we were reducing the number of years left on the mortgage by making these payments. This may be difficult but well worth the effort in the a few years down the line. We would have much preferred to have taken out a loan with a 15 year fixed mortgage rate but we had to consider our other commitments as well. Things worked out well anyway, even though we were unsure about it to start with.
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