Guide to Mortgage Products and Rates

Home loan and home refinance options offer a diversity through different mortgage products.  It is important for consumers to know what the basic options are so that they can make a good decision, and be able to evaluate which products suits your needs more closely.

Home loan options are basically the same as the options in refinance home loans.  So whether you are borrowing for the first time or refinancing your home, the interest rates and terms are basically the same.  The factors that determine your offer are the same too, and this include loan to home value, credit score and history, debt to income ratio, and income.  These factors will determine the type of mortgage product they will offer you and this comes with varying rates and terms. Click here to get some facts.

The first mortgage produce is the fixed rate home loan and refinance home loan, and this has a single interest rate which does not change for the terms of the loan, until the loan is either repaid or refinanced into a different loan.  This type of home loan has a higher mortgage rate than the introductory rate on an adjustable rate loan.  But this type of home loan is more stable and predictable and reasonable based on current rates.  Fixed rate loans are the most common and secure type of loans.  If you plan to live in your home for a long period of time, then this type of home loan is recommended for you.

Another home mortgage and home refinance option is the adjustable rate loan.  This type of loan has a fixed rate for a limited amount of time like one, three, or five years.  When then fixed rate has expired after the time limits, the rate is adjusted according to the schedule in the original mortgage.  The adjusted rate will depend on the current mortgage rate market.  This rate can either be higher or lower.

The instability of the refinance mortgage rate for adjustable rates is not very appealing.  Mortgage payments may increase significantly when corrections are made.  You will only know the mortgage payment while you are still in the fixed rate term. Be sure to visit this website at http://trader.wikia.com/wiki/Commercial_mortgage-backed_security for more facts about loans.

There are good reasons to use an adjustable rate mortgage despite being less secure than fixed rate mortgage.  If you are not planning to stay long in that home, it could be more affordable for you since it is cheaper during the adjustable period.  While building your credit rating to qualify for a better fixed rate mortgage, it gives you time to enjoy a low payment.

To be able to evaluate your mortgage and home financing value, seek advice from a reputable lender, get quotes and compare them against you budget and future plans. Visit us today.