Fixed Rate Mortgage
Fixed rate mortgages are your most conventional types of financing. With a Fixed rate mortgage you never have to worry about your rate adjusting, you have a set rate for the life of the loan. Typical fixed rate mortgages are 40yr Fixed, 30yr Fixed, 20yr Fixed, 15yr Fixed and 10yr Fixed. The shorter the period of your mortgage, the more quickly you pay down your debt and the less interest you will end up paying. Transversely, the shorter the time span of the loan, the more attractive the interest rate you will receive. Fixed rate loans are amortized over the period of the loan so that your 1st payment carries the most amount of interest and the least amount of principal, and your last payment carries the most amount of principal and the least amount of interest.
Fixed rate financing is best for people who know that they will be in their home for a long period of time, often greater than 5-7 years and like the stability of a constant payment that will never change. If you would like to pay your mortgage down faster, we would suggest doing a 30yr Fixed and just making one extra payment a year and that alone will pay down your mortgage in 24 years versus 30. You can always turn a 30yr fixed into a 15yr or whatever period you like by paying extra each month, but you cannot turn a 15yr into a 30yr.