Home Mortgage Loans - Fixed Rate, Adjustable Or Balloon, Which One Is Right For You?

Written by Carrie Reeder

When you're shopping for a new home—especially forrepparttar first time—allrepparttar 148345 terms and expressions may be confusing and difficult to understand. Adjustable rate, fixed rate, balloon payment - how do you decide which isrepparttar 148346 right type of home mortgage for you if you're not even sure what each of them are?

The name ofrepparttar 148347 mortgage type usually has to do with how you'll pay for your loan - howrepparttar 148348 interest onrepparttar 148349 loan is being determined byrepparttar 148350 bank. The three major types of mortgages are fixed rate, adjustable rate and balloon payment. Each has advantages and disadvantages.

Fixed Rate Mortgage

With a fixed rate mortgage, you have a set interest rate forrepparttar 148351 entire life ofrepparttar 148352 loan. The interest rate that you pay for your loan won't change - which means that you'll payrepparttar 148353 same monthly payment forrepparttar 148354 entire length ofrepparttar 148355 loan. This protects you from unexpected rises in interest rates that would increase your monthly payment. Atrepparttar 148356 same time, shouldrepparttar 148357 interest rates drop, you will haverepparttar 148358 option of refinancing at a lower interest rate. Becauserepparttar 148359 protections are largely onrepparttar 148360 side ofrepparttar 148361 buyer with a fixed rate mortgage, interest rates on them are generally slightly higher than they would be on other types of mortgages.

A fixed rate mortgage isrepparttar 148362 safest type. Becauserepparttar 148363 payments are predictable, it’s usually consideredrepparttar 148364 most desirable type of mortgage. Always choose a fixed rate mortgage if interest rates are rising.

Adjustable Rate Mortgage

When you choose an adjustable rate mortgage, your monthly payment and interest rate will fluctuate withrepparttar 148365 current market interest rate. Ifrepparttar 148366 interest rate goes up, so will your monthly payment. If it drops, your monthly loan payment will as well. The adjustable rate is tied to an index, which is determined byrepparttar 148367 lender. Other terms ofrepparttar 148368 mortgage are also determined byrepparttar 148369 lender. These include how oftenrepparttar 148370 interest rate is adjusted - anywhere from every 3-6 months to once a year, how muchrepparttar 148371 interest rate can increase or decrease on any adjustment date, and whether there is a 'cap' on how highrepparttar 148372 interest rate can rise.

Get Out of Debt

Written by Medha Roy

It is said that a pet tiger cub can become dangerous if it tastes blood. It will stop at killing no one, not evenrepparttar people who brought it up. Similarly, once we getrepparttar 148344 taste of money andrepparttar 148345 freedom of purchasing through credit, we seem to know no bounds. What do we land up with? Heaps and heaps of debt.

Most of us feel rich atrepparttar 148346 beginning ofrepparttar 148347 month and end up feeling like worms atrepparttar 148348 end of it. To relieve us of this feeling, credit cards have made their entrance with full gusto. And we have been literally swept off our feet. We can afford to be rich even onrepparttar 148349 last day ofrepparttar 148350 month. We can buy whatever we want forrepparttar 148351 kids, forrepparttar 148352 house and for ourselves, credit cards showing usrepparttar 148353 green signal all along. Little do we think ofrepparttar 148354 unpaid bills ready to storm us anytimerepparttar 148355 following month.

OK. Now, its paytime folks! Have you seenrepparttar 148356 first Harry Potter movie? The scene in which sealed letters for Harry, from Hogwarts, begin to pour intorepparttar 148357 house from all openings and outlets? Unpaid credit card bills begin to pour into our lives just like that. Lightning strikes on a bright sunny day and darkens our lives big-time. There are two clear roads for you to take. One, mortgage everything you have, sell all valuables, take your children out of school, sell your car - in one word, commit suicide. The other way is to think wisely (at least this time) and look for ways to get out of debt.

One ofrepparttar 148358 first things people think of doing is file bankruptcy. This is again one ofrepparttar 148359 biggest mistakes anyone can make. For a debt of $7000, you will end up ruining your credit score forever. Andrepparttar 148360 social and psychological pressure of bankruptcy is not a matter of joke. Meanwhile, creditor calls are causing you sleepless nights. What'srepparttar 148361 best way out? Consolidate all your debts. Contact a local but well-known debt consolidation firm and take their advice and help.

Debt consolidation programs condense multiple debts into one and reduce your debts. They contact your creditors and make them stop calling you. Then they make you pay one low payment every month and eliminate debts much faster than you would have done on your own. Debt consolidation programs not only eliminate debts but they also draw up a budget for you. If you follow this budget, you can become debt-free in months and never ever incur debts again.

Cont'd on page 2 ==>
ImproveHomeLife.com © 2005
Terms of Use