There are several different types of mortgage loans. Some of the main types of amortized loans represent the adjustable rate mortgage and the fixed rate mortgage. Many mortgages are available online as well as online mortgage quotes.
Fixed Rate Mortgage
Fixed rate mortgage interest rate and the monthly payment is always fixed for the duration of the mortgage loan. Some of the common mortgage terms are 10, 15, 20, and 30 years. In the recent years some lenders have been offering terms that are amortized for 40 and 50 year mortgage terms.
Adjustable (Variable) Rate Mortgage
Adjustable or variable rate mortgage interest rate is fixed for an agreed period of time. After the expiration of this time, it will periodically adjust upwards or downwards according to market index levels. Those indices include the Prime Rate, the London Interbank Offered Rate, and the T-Bill (Treasury Index).
Mortgage Rates : Bad Credit Good Credit Game
Lenders refer to the borrowers’ credit reports and credit scores when approving a mortgage application. The better (higher) the score, the better rates a borrower can obtain. Lower credit scores, however mean higher risk to the lender, therefore mortgage lenders will require higher interest rates in order to compensate for the increased risk.
Balloon Type Mortgages
A balloon, or partial amortization loans are the ones in which the mortgage monthly payments are calculated over a certain period of time. The outstanding principal balance is payable at by the end of the mortgage term. This type of payment of the principal is also called a balloon payment. A balloon mortgage loan can either be of fixed or an adjustable interest Rate.
Online Mortgage Applications and Obtaining Low Mortgage Rates Online
Mortgages online can typically be obtained at lower online rates. Many people save thousands of dollars when applying for a mortgage online or when getting an online mortgage quote.