| One of the things that you might not be aware of | | | | and some have a lifelong cap, meaning that there is an |
| when you are looking for mortgage rates is that there | | | | amount of change that can be met, after which the |
| are different types of mortgages, and if you are able | | | | loan will not go any further up or any further down. |
| to discuss these different types with your lenders, you | | | | Government Guaranteed Mortgage Loans |
| will find better deals. The different types of mortgages | | | | There are also government guaranteed mortgage |
| are meant to be used for people of different ages and | | | | loans. This is a FHA loan, which is a fixed rate |
| experiences, and with different job histories, credit | | | | mortgage, designed for a first time home buyer, who |
| histories, and financial obligations. The many different | | | | has moderate or low income. This is a loan that is |
| types of mortgages translate to chances for just | | | | guaranteed by the Federal Housing Administration, as a |
| about everyone to find a good deal on a home loan, | | | | way to make sure that first time home buyers are |
| so if you are interested in a mortgage it is important to | | | | getting into home ownership and are ready to become |
| focus on the different types of mortgages so you | | | | home owners. It can be easier to qualify for these |
| know you can find the one with the lowest rate. There | | | | loans, because they usually have a lower credit rating |
| are several different types of mortgages that you | | | | approval, and a lower income that is needed to qualify |
| should be aware of, so that you can explore them and | | | | to pay back the mortgage. |
| figure out which ones will have the lowest rates for | | | | VA Loans |
| you. | | | | VA loans are another type of mortgage loans. These |
| Basic Home Mortgages | | | | are loans that are meant for people who have been in |
| First of all, there are basic home mortgages. These | | | | military service. Either someone who has been on |
| are two different types of mortgages that are the | | | | active duty with the military ,or a spouse of someone |
| most popular. First is the traditional fixed rate mortgage, | | | | who died as an active service member are eligible to |
| and second is the adjustable rate mortgage. Both of | | | | get VA loans. These loans can be easier to get |
| the mortgages have a basic monthly payment, and | | | | because they often require little or no down payment. |
| then an interest rate that is added onto them. | | | | In order to get VA loans, the person must be able to |
| However, they are different. | | | | make the monthly payments. |
| With a fixed rate mortgage, your interest rate is locked | | | | USDA Rural Development Guaranteed Housing Loan |
| in when you begin to pay back the loan. This means | | | | Another government guaranteed loan, the USDA rural |
| that you have a fixed rate for your repayment, for the | | | | development loan, is given to people who have low to |
| length of your mortgage. The rate will stay the same | | | | moderate income, and who are purchasing a home in |
| for the life of the loan, no matter what the current | | | | a place that has been designated as a Rural |
| market does. Therefore, when you are paying back | | | | Development Area. With this type of loan, there is no |
| this type of loan, you will have a stable amount to pay | | | | down payment that is required, and often there is no |
| back each month. | | | | mortgage insurance required. It can be much easier to |
| The adjustable rate mortgage is another option, and it | | | | get this type of loan than any other type of mortgage, |
| has actually become quite popular lately. This is a basic | | | | as long as you are buying a home in a rural |
| home mortgage that allows the interest rate to | | | | development area. |
| fluctuate with the changes in the market. It means that | | | | Option ARMS |
| whatever home market values are doing, it is reflected | | | | Another type of loan is a flexible payment ARM. |
| in the interest rate that you are paying. This means | | | | These loans have an interest rate that adjusts each |
| that if market values go up, your payment will go up, | | | | month with no caps on the adjustments. Often, these |
| but if market values go down, your payment will go | | | | loans will allow you to make low payments right away, |
| down. Some of these loans have a cap to the amount | | | | but the payments will increase over time, and will often |
| of change that can occur during an adjustment period, | | | | increase a large amount very quickly. |