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Mortgage Loan Information - Know The Basics When You Refinance or Purchase a Home
from: Carrie ReederIf you are currently looking for a new home, chances are that in all the excitement you won’t really give any thought to the type of home loan mortgage you take out, instead going with the first one offered to you. This could be a serious mistake – costing you thousands, if not tens of thousands. Make sure you know all about the different types of home mortgage loans before you starting looking for that new dream home!
Here are some of the basic types of mortgage loans:
Fixed-rate home loan mortgage -
As the name suggests, this is a plain-vanilla home loan. Basically you borrow a certain amount over a certain period at a fixed rate of interest. You then pay the same monthly installments for the life of the home loan. The benefit of a fixed-rate home loan is that you can easily budget for the repayments. The downfall of a fixed-rate home loan is that you could end up paying a higher rate of interest than everyone else – no one knows what interest rates will be in 15-20 years time!
Adjustable-rate home loan mortgage -
Mirroring the fixed-rate mortgage is the adjustable-rate mortgage. Again, you borrow a certain amount over a certain period, however in this case the interest rate is not fixed, but is adjustable (or ‘floating’ as you may also hear it called). The upside to adjustable-rate home loans is that the interest rate at the start of the loan period can be lower than the fixed rate would be. The downside is that it is difficult to budget for, as the amount can change, and you are at the mercy of something outside of your control – interest rate fluctuations, which can change quickly.
Hybrid home loan mortgages -
Trying to fill the void left with the downside of the fixed and adjustable/variable-rate home loans, the hybrid home loan lets you fix the interest rate over the first part of the home loan, and then switch to an adjustable/variable rate later. The upside of hybrid home loans is that they allow you to budget for your repayments during the expensive time when you first buy the home. The downside is that if floating rates are much higher than your fixed rate when the switch happens, you could find you are paying a much higher repayment each month.
To see our list of recommended mortgage lenders with competitive rates for refinance, purchase loans, second mortgages, home equity loans and all other mortgage loans, visit this page Recommended Mortgage
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About the Author
Carrie Reeder is the owner of ABC Loan Guide, an informational website about various types of loans. The site has informative articles and the latest finance news.
Home Mortgage Refinance News
Refinancing applications reportedly overwhelm BofA - The Seattle Times
 Bloomberg | Refinancing applications reportedly overwhelm BofA The Seattle Times The government's Home Affordable Refinance Program, which helps homeowners lower payments, has increased refinance applications and strained capacity at Bank of America, which exited some mortgage lines last year. The federal program, now dubbed HARP 2 ... New HARP Could Help Up to 6.7 Million BofA Said to Put Off Refinancing Clients as U.S. Spurs Demand MBS Prepayments Suggest Slow Uptake On Government's HARP |
Obama Mortgage Refinancing Plan: A Bailout by Any Other Name - National Legal and Policy Center
 National Legal and Policy Center | Obama Mortgage Refinancing Plan: A Bailout by Any Other Name National Legal and Policy Center The Federal Reserve purchased $1.25 trillion in mortgage securities to keep mortgage rates down. And the Obama administration created the still-operative Home Affordable Modification Program (HAMP) and Home Affordable Refinance Program (HARP) to make ... Obama's Refinancing Plan Means Fee for Homeowners Reduce the principal to fix the housing mortgage crisis President Obama: Helping US homeowners is critical |
REAL ESTATE: Refinancing program expands for Fannie/Freddie borrowers - Press-Enterprise
 Bloomberg | REAL ESTATE: Refinancing program expands for Fannie/Freddie borrowers Press-Enterprise ... who owe more on their homes than they are worth to refinance at today's rock-bottom rates. The limitations are that the homeowners must be current on their loan payments and their mortgages must be owned by private financial institutions. Mortgage Bonds Face Eye of Storm as Refinancings Decline: Credit Markets As Mortgage Refinancings Surge, Banks Struggle Refinancing homeowners saving big |
Mortgage refinancing is on the rise - Washington Post (blog)
 Christian Science Monitor | Mortgage refinancing is on the rise Washington Post (blog) According to the Mortgage Bankers Association, mortgage refinancing is on the rise, increasing 9.4 percent over the previous week and 5.7 percent over the past month. He also predicts that the changes the White House recently made to the Home ... Mortgage applications jump on refi demand: MBA Mortgage rates: How low can they go? Mortgage applications jump as interest rates hit new lows |
Obama Said to Plan Assistance for Home Mortgage Refinancing - San Francisco Chronicle
 Wall Street Journal | Obama Said to Plan Assistance for Home Mortgage Refinancing San Francisco Chronicle The president also will reveal a pilot program to sell foreclosed properties in bulk to investors who maintain the homes as rentals, the official said. The pilot will be limited to homes owned by Fannie Mae, the mortgage company under government ... Obama Seeks Refinancing Aid to Lift Housing Obama unveils mortgage refinancing plan Obama Plans Assistance for Rentals, Mortgage Refinancing |
Obama Said to Plan Assistance for Home Mortgage Refinancing - Bloomberg
 Bloomberg | Obama Said to Plan Assistance for Home Mortgage Refinancing Bloomberg Enlarge image Obama Plans Assistance for Rentals, Mortgage Refinancing Obama Plans Assistance for Rentals, Mortgage Refinancing Matthew Staver/Bloomberg Champion Home Builders Inc. in Flint on Oct. 26, 2011. Play Video Play Video President Barack Obama ... Obama wants Congress to act on expanded home refinance plan President Obama calls on Congress to pass new mortgage refinancing plan Obama proposes new government guarantee for homeowners to refinance |