Mortgage interest rate comparison chart
homebuyers carefully compare lenders for not only the “lowest” interest
rate, but also the ideal mortgage terms.
Some lenders may have a slightly higher interest rate, but may offer lower closing costs. Here is a comparison chart of lenders who are anxious to speak to you about financing your new home or refinancing your current mortgage.
Did you know that your credit score determines your interest rate? Read more
What is a rate lock? How long can you "lock" an interest rate? Read more
Did you know that you can "buy down" an interest rate with points, and the seller is allowed to pay those discount points? Read more
Fixed Rate Mortgage
With a fixed rate mortgage, your interest
rate will remain the same over the life of
mortgage (i.e. 5, 10, 15, 20, 25, 30 or 40
years). The interest rate is usually higher
than other types of mortgages because the
lender has more risk if the interest rates
increase during the term of your mortgage.
For this reason, the lender has a little
cushion built into the fixed rate mortgage.
The mortgage payment will remain the same
from the first payment to the last payment.
The fixed rate mortgage is the most
conservative payment plan.
Fixed Rate Comparison Calculator
Adjustable Rate Mortgage
As the name implies, the mortgage interest rate will “adjust”. Adjustable rate mortgages are also called “variable rate mortgages”. There are several varieties of adjustable rate mortgages. For example, the interest rate on the one year adjustable (1 year ARM) rate mortgage will adjust or change every 12 months. The interest rate can go up or down or even remain the same. Another type of adjustable rate mortgage is the hybrid mortgage. This adjustable rate mortgage has a fixed rate of 3, 5, 7 or 10 years and then converts to a one year adjustable. The advantage of this mortgage is a stable, known monthly payment that is fixed for a certain term (i.e. 3, 5, 7 or 10 years) before the interest rate is subject to change. The interest rate on adjustable rate mortgages are usually lower than the fixed rate mortgage
A balloon mortgage is a home loan with a monthly payment for a specific number of years, usually five or seven years and then the loan balance is due in full. When the "balloons", the borrower must refinance the mortgage balance or refinance the loan.
Bi monthly Mortgage
The bi monthly mortgage is a loan that requires one half of the monthly mortgage payment to be paid twice a month. A loan payment paid in two installments lowers the overall interest paid to the lender.
Bi weekly Mortgage
A bi weekly mortgage is one half of the loan payment paid every two weeks. For example, if your monthly payment is $500 per month, your 12 payments equal $6,000 ( 12 weeks X $500 = $6,000 ). The bi weekly payment arrangement results in 26 payments ( 26 weeks X $250 = $6,500 ) per year. The extra money each year pays off the mortgage faster.
Interest Only Mortgage
A mortgage is "interest only" if the monthly mortgage payment does not include any repayment of principal. If the payment remains interest only, the loan balance remains unchanged