Kinan Beck is the Broker and co-owner of One Source Realty in Austin Texas. Visit Kinans Austin Real Estate Guide, visit his Lake Austin Real Estate companys website, & his Austin Apartments website. He has seen considerable success in real estate, and looks forward to many more years in the business.
If youve
started looking into getting a home loan, youve probably already discovered
that there are a number of decisions to be made. One of the biggest ones is
whether to get a fixed rate home loan or to go with a variable rate home
loan. Here are some of the questions that you might have about a fixed rate
home loan:
1) What is a fixed rate home loan?
It basically is what it sounds like it is. With a fixed rate home loan, the
interest rate on your loan does not fluctuate. This means that the market and
economy might change but the interest rate that you locked in at with your
fixed rate home loan remains the same.
2) What are the pros and cons of a fixed rate home loan?
At the outset, fixed rate home loans usually have a higher interest rate
than those being offered by variable rate home loans. Those individuals who
arent able to pay higher monthly payments on their loan may find that the
variable interest rates give them better payment options initially. However,
since variable interest rates go up and down, there are times when the fixed
rate home loan rates would be cheaper.
Individuals who are able to do well with budgeting and planning often find
that the benefits of having a fixed rate home loan payment outweigh the
benefits of a lower initial interest rate. This is because the amount of the
payment on a fixed rate home loan can always be anticipated, allowing for
budgeting. Variable rate loans vary enough to make this planning difficult
for some people.
3) Is it possible to adjust the rate on my fixed rate home loan?
What most people want to know when they ask this question is whether it is
possible to get a fixed rate loan and then lower that rate when the market
changes and lower interest rates become available. The answer is yes, and no.
It is possible to refinance your home in order to obtain a lower interest
rate at the time that it is being offered. However, there are usually fees
associated with changing your fixed rate home loan. These fees almost always
outweigh the costs saved on trying to get the lower rate, so its not often
done.
4) How long will it take to pay back my fixed rate home loan?
The term of repayment on your fixed rate home loan depends upon the amount
of time that you need to repay the loan as determined by your lender. Fixed
rate home loans are almost always either fifteen year loans or thirty years
loans, with the latter being more common for most buyers.
That sums up the basic questions that most people have about getting a
fixed rate home loan. Basically, if you want to have a stable monthly payment
throughout the duration of your home loan, then you should get a fixed rate
loan. If you would rather take your chances on playing the market with a
variable interest rate in the hopes of paying a lower loan rate, well, that
choice is up to you.
Kinan Beck
is the Broker and co-owner of One Source Realty in Austin Texas.Visit Kinans <a
href="http://www.kinanbeck.com">Austin TX Real Estate</a>
Guide, visit his <a href="http://www.ericbramlett.com/steinerranch.php">Steiner
Ranch Real Estate</a> companys website, & his<a
href="http://www.onesourcetulsa.com/">Tulsa Real
Estate</a> website.He has seen
considerable success in real estate, and looks forward to many more years in
the business.
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Kinan Beck is the Broker and co-owner of One Source Realty in Austin Texas. Visit Kinans 
