Mortgage Rates: Types of Mortgage Rates and Which Is The Best
by K. Yasuhara
For a layman like me, all this financial talk seems to confuse me even more. Unfortunately, mortgages are not something we can just forget exists, because at the end of the day, we will all need to live, and in order to live, we need a place to live in, and that is where mortgages come in. So what is a mortgage? A mortgage is a security in estate by a lender as a security for a debt. So what are mortgage rates? It is the rate or rate of interest applied to the loan as to be paid by the debtor. So let’s take a look at the different types of mortgage rates.
The first type would be fixed rate mortgage. I presume that a fixed rate mortgage is the most well known of all mortgages purely because it covers a property for a long term, and the rates are fixed throughout the term. There are four types of fixed rate mortgages, the first being 30 year fixed rate mortgages, the second being 15 year fixed rate mortgages, the third being biweekly mortgages and the last, “convertible” Mortgages. Although the best thing about a fixed rate mortgage is not having to worry that your interest rate would increase throughout the term, there is still the price factor in which the amount charged is higher compared to mortgages with fluctuating interest rates because you will be paying extra for that “security”, of knowing that your payments will never change.
Another one is called a premium mortgage rate. This type of mortgage rate is a hybrid of a fixed mortgage rate and an adjustable rate mortgage. This mortgage usually allows the buyer to experience the secured payment like with a fixed mortgage rate for a certain period of time, say 10 years, and then the rate is expected to fluctuate according to the variable conditions.
There are also adjustable mortgage rates. An adjustable rate mortgage is a mortgage whereby the rate of payment changes depending on variable indices. Some common indices in the United States would be the National Average Contract Mortgage Rate and the 12-month Treasury Average Index (MTA). These kind of mortgage is best for those not intending to keep a property for a long period of time, for example someone who is planning to move to another location after some time.
So among these mortgage rates, which would you pick? It entirely depends on what you need at the time and your ability to pay as well to find the best mortgage for you.
Mortgage rates fell this week to the lowest level on records dating to 1971, giving consumers added incentive to lock in low payments for home purchases and refinanced loans. (June 24)
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Another reason is lenders want a 700+ credit score to give a loan. They used to “ignore” medical bills now they include those.
If you have a credit score of less than 700 the rates go up. if less then 650 it almost triples. If less than 620 they won’t even consider you for a loan.
Well there it is folks…the economy is in the tank and “double-dip” will be a fond characterization of what’s about to happen. I figure King zerO and his Court have until Jan 20th next year to impose a socialist oligarchy on us, so the race is on. zerO’s plan: Ride America into the ground in the interest of “social justice”.
Filibuster EVERYTHING republicans.
you want a house where you can get your money’s worth out of it in around 10 years…why the hell would you get a 50 year loan? you probably won’t even live that long
you want to know how to buy a house and make it a profitable investment? you take the price of the home and divide by the average cost of rent in that area and then see if you can actually get your money’s worth out of it …so if you have a 300,000 dollar house and you’d normally pay like $1000/month rent then it’d take you 300 months to get your money’s worth out of it…hardly a good investment…so based on that, like 95 % of houses are not even profitable investments
Story today on BusinessInsider(dot)com titled Goldman: Sorry, Housing Prices Will Keep Falling For Two Years
Why buy a house that is worth less in two years? Interest rates will need to start paying people to buy a house. Wall Street, the Federal Reserve or federal gov do not want house prices to be reevaluated – lowered. Once this happens the entire house of cards (American economy) with implode. We don’t make anything in American that anyone wants to buy anymore. Depression is a certain.