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Mortages
Choosing a mortages program. There isn't a single or simple answer to this question. The right type of
mortages for you depends on many different factors: Your current financial
picture, how you expect your finances to change, how long you intend to keep your
house, how comfortable you are with your mortgage payment changing.
For example, a 15-year fixed-rate mortgage can save you many thousands of dollars in interest payments over the life of the loan, but your monthly payments will be higher. An adjustable rate
mortages may get you started with a lower monthly payment than a fixed-rate mortgage -- but your payments could get higher when the interest rate changes.
Fixed Rate Mortgages : The most common type of
mortages program where your monthly payments for interest and principal never change. Property taxes and homeowners insurance may increase, but generally your monthly payments will be very stable.
Fixed-rate mortgages are available for 30 years, 20 years, 15 years and even 10 years. There are also "bi-weekly"
mortages, which shorten the loan by calling for half the monthly payment every two weeks.
Balloon loans are short term mortages that have some features of a fixed rate mortgage. The loans provide a level payment feature during the term of the loan, but as opposed to the 30 year fixed rate mortgage, balloon loans do not fully amortize over the original term. Balloon loans can have many types of maturities, but most balloons that are first mortgages have a term of 5 to 7 years.
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