Fixed-Rate Mortgage
Quick Answer
A fixed-rate mortgage is a home loan with an interest rate that remains constant for the entire loan term.
Definition
A fixed-rate mortgage is a home loan with an interest rate that remains constant for the entire loan term.
Explanation
A fixed-rate mortgage offers predictable monthly payments because the interest rate never changes. Most fixed-rate mortgages have terms of 15 or 30 years. The 30-year option has lower payments but more total interest, while the 15-year has higher payments but significant interest savings.
These loans are ideal for buyers who plan to stay long-term and want payment certainty.
Example
A $350,000 home with a 30-year fixed mortgage at 6.5% has a monthly payment of $2,212 for principal and interest.
Frequently Asked Questions
What is Fixed-Rate Mortgage?
A fixed-rate mortgage is a home loan with an interest rate that remains constant for the entire loan term.
How does Fixed-Rate Mortgage work?
A fixed-rate mortgage offers predictable monthly payments because the interest rate never changes. Most fixed-rate mortgages have terms of 15 or 30 years. The 30-year option has lower payments but more total interest, while the 15-year has higher payments but significant interest savings.These loans are ideal for buyers who plan to stay long-term and want payment certainty.
Can you give an example of Fixed-Rate Mortgage?
A $350,000 home with a 30-year fixed mortgage at 6.5% has a monthly payment of $2,212 for principal and interest.
Free Excel Templates
Also try our free Mortgage Amortization Schedule template
Create a detailed mortgage amortization schedule. See exactly how much principal and interest you pay each month over the loan term.
Download Mortgage Amortization Schedule