Nowadays, there are various
options in the industry these are probably the most confusing time for anyone
who is considering availing of a mortgage. Moreover, interest rates seem to be
constantly fluctuating and this add up to the confusion in getting the best
Generally, there are two major types of loans. They are the fixed rate mortgage
and the variable rate mortgage. Both types have their own advantages and
disadvantages which anyone should consider carefully.
A fixed rate mortgage
makes the monthly payments the same all throughout. Interest rates do not
change whether or not there is an increase in the industry. What was set at the
very start continues until the entire loan has been paid for.
On the other hand, a variable rate mortgage paves the way for some adjustments
in the interest rates. If the rates are higher now, monthly payments will
increase as well, as regulated by a certain interest index. Advantage comes in
when the rates decrease at a certain period of time.
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