Homeowner Loans - The Types And Differences
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James Copper
Apr 26, 2013, 10:30:05 AM4/26/13
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Article Title: Homeowner Loans - The Types And Differences
Author: James Copper
Word Count: 554
Article URL: http://www.isnare.com/?aid=140348&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=140348
Easy Publish Tool: http://www.isnare.com/html.php?aid=140348
*********************** ARTICLE START ***********************
Homeowner loans or mortgages come in two basic types. There are fixed rate homeowner loans and adjustable rate homeowner loans. These terms refer to the interest rate applied to the loan.
Both types of loans have pros and cons. Before a person decides on which type of homeowner loan to get they should understand each type so they can make the best decision for them.
Fixed rate loans have a locked in interest rate. When the loan is made, the current interest rate is used for the life of the loan. The biggest advantage to this type of loan is that the monthly payment amount will not change.
However, if the rate locked in at is rather high then in the long run the homeowner will pay a lot for the loan. Fortunately, there is the option of refinancing when interest rates fall. This does involve more paperwork and can include additionally costs. Some people may not prefer this option due to these factors.
Adjustable rate loans have an interest rate that changes as the interest rates change. With this type of loan the monthly payment will change. The homeowner will not ever know exactly how much they need to pay until the due date.
The good point about this type of loan is that they allow the homeowner to take advantage when rates drop right away. However, if rates suddenly rise the homeowner is stuck with them.
Some people prefer to start with an adjustable rate if the market has been steadily falling. Once they reach a comfortable rate they then switch to a fixed rate loan so they can lock in at the lowest rate possible. Some people go with a fixed rate loan and simply refinance whenever the rates fall drastically.
The choice between a fixed rate and adjustable rate homeowners loan is something that should be made carefully. Lenders have created homeowner loans that combine aspects of both types of loans to try to entice buyers. Mixes loans may start out as fixed and turn to adjustable or start out adjustable and turn to fixed.
They may offer a fixed rate at a discount for a few months and then lock in at the current rate after that initial time period. These types of mixed loans are really a sales tactic, but they can prove to be very helpful for a person who is unsure which type of homeowner loan to go for.
Homeowner loans can be very confusing, especially when it comes to interest rates. The whole idea is to choose the loan that will cost the least. However, with interest rates changing all the time it is often hard to figure out just what the best rate is.
One of your options is to find a good mortgage broker, ask your friends and family if they can recommend one to you. Using a mortgage broker will make your life a lot easier, saving you both time and money.
They will be able to look at your requirements and circumstances and go away and find a homeowner loan that best fits your criteria. They will charge you a fee, but in long run you will save money.
About The Author: James Copper is a mortgage broker with over 30 years experience. He works for http://www.any-loans.co.uk/homeowner-loans.shtml as a homeowner loan advisor. In his spare time he writes on all things finance and investment related.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=140348
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
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Message delivered directly to members of the group:
publish-the...@googlegroups.com
*****************************************************************
Please consider this free-reprint article written by:
James Copper
*****************************
IMPORTANT - Publication/Reprint Terms
- You have permission to publish this article electronically in free-only publications such as a website or an ezine as long as the bylines are included.
- You are not allowed to use this article for commercial purposes. The article should only be reprinted in a publicly accessible website and not in a members-only commercial site.
- You are not allowed to post/reprint this article in any sites/publications that contains or supports hate, violence, porn and warez or any indecent and illegal sites/publications.
- You are not allowed to use this article in UCE (Unsolicited Commercial Email) or SPAM. This article MUST be distributed in an opt-in email list only.
- If you distribute this article in an ezine or newsletter, we ask that you send a copy of the newsletter or ezine that contains the article to http://www.isnare.com/eta.php?aid=140348
- If you post this article in a website/forum/blog, ALL links MUST be set to hyperlinks and we ask that you send a copy of the URL where the article is posted to http://www.isnare.com/eta.php?aid=140348
- We request that you ask permission from the author if you want to publish this article in print.
The role of iSnare.com is only to distribute this article as part of its Article Distribution feature ( http://www.isnare.com/distribution.php ). iSnare.com does NOT own this article, please respect the author's copyright and this publication/reprint terms. If you do not agree to any of these terms, please do not reprint or publish this article.
*****************************
Article Title: Homeowner Loans - The Types And Differences
Author: James Copper
Word Count: 554
Article URL: http://www.isnare.com/?aid=140348&ca=Finances
Format: 64cpl
Contact The Author: http://www.isnare.com/eta.php?aid=140348
Easy Publish Tool: http://www.isnare.com/html.php?aid=140348
*********************** ARTICLE START ***********************
Homeowner loans or mortgages come in two basic types. There are fixed rate homeowner loans and adjustable rate homeowner loans. These terms refer to the interest rate applied to the loan.
Both types of loans have pros and cons. Before a person decides on which type of homeowner loan to get they should understand each type so they can make the best decision for them.
Fixed rate loans have a locked in interest rate. When the loan is made, the current interest rate is used for the life of the loan. The biggest advantage to this type of loan is that the monthly payment amount will not change.
However, if the rate locked in at is rather high then in the long run the homeowner will pay a lot for the loan. Fortunately, there is the option of refinancing when interest rates fall. This does involve more paperwork and can include additionally costs. Some people may not prefer this option due to these factors.
Adjustable rate loans have an interest rate that changes as the interest rates change. With this type of loan the monthly payment will change. The homeowner will not ever know exactly how much they need to pay until the due date.
The good point about this type of loan is that they allow the homeowner to take advantage when rates drop right away. However, if rates suddenly rise the homeowner is stuck with them.
Some people prefer to start with an adjustable rate if the market has been steadily falling. Once they reach a comfortable rate they then switch to a fixed rate loan so they can lock in at the lowest rate possible. Some people go with a fixed rate loan and simply refinance whenever the rates fall drastically.
The choice between a fixed rate and adjustable rate homeowners loan is something that should be made carefully. Lenders have created homeowner loans that combine aspects of both types of loans to try to entice buyers. Mixes loans may start out as fixed and turn to adjustable or start out adjustable and turn to fixed.
They may offer a fixed rate at a discount for a few months and then lock in at the current rate after that initial time period. These types of mixed loans are really a sales tactic, but they can prove to be very helpful for a person who is unsure which type of homeowner loan to go for.
Homeowner loans can be very confusing, especially when it comes to interest rates. The whole idea is to choose the loan that will cost the least. However, with interest rates changing all the time it is often hard to figure out just what the best rate is.
One of your options is to find a good mortgage broker, ask your friends and family if they can recommend one to you. Using a mortgage broker will make your life a lot easier, saving you both time and money.
They will be able to look at your requirements and circumstances and go away and find a homeowner loan that best fits your criteria. They will charge you a fee, but in long run you will save money.
About The Author: James Copper is a mortgage broker with over 30 years experience. He works for http://www.any-loans.co.uk/homeowner-loans.shtml as a homeowner loan advisor. In his spare time he writes on all things finance and investment related.
Please use the HTML version of this article at:
http://www.isnare.com/html.php?aid=140348
*********************** ARTICLE END ***********************
- To distribute your articles go to http://www.isnare.com/distribution.php
- For more free-reprint articles go to http://www.isnare.com
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