Fixed-Rate Loans: What You Need to Know When Buying a Home in Eden Prairie, MN
When reading up on mortgages in Eden Prairie, you'll run across some jargon you might not be familiar with. "Fixed-right" might be one of those words. As a company that's driven to keep the dream of homeownership alive, Mr. Cooper is on a mission to simplify every aspect of buying a house — including the words!
So, what is a fixed-rate home loan? "Fixed-rate" means the interest rate on your mortgage doesn't change. An interest rate is what the lender charges for loaning you money. It is expressed as a percentage. Interest rates on home loans can vary by the day, so a fixed-rate loan allows you to secure a stable rate. Fixed-rate home loans usually have a 30-year term length. Shorter timeframes are possible and generally include larger monthly payments but less total interest paid over the loan's lifetime. How do fixed-rate loans compare to other home loan options in Eden Prairie?
Adjustable-Rate Loans vs. Fixed-Rate Loans in Eden Prairie, MN
It's a good idea to learn about all of your loan options in Eden Prairie, including adjustable-rate loans. An adjustable-rate mortgage (ARM) is different from a fixed-rate mortgage in that the interest rate can go up or down based on national indexes. An adjustable-rate mortgage will maintain the same rate for typically 3, 5, or 10 years, then the rate is revised at specific intervals. If your interest rate increases after the fixed-rate timeframe has ended, your monthly payments might increase too. Talk to a Mr. Cooper mortgage professional about the protections a fixed-rate loan can offer. We'll help you understand the factors that can go into choosing between a fixed-rate and adjustable-rate mortgage, like if you could still pay on an ARM if interest rates went up, how large of a mortgage payment you can qualify for, how long you plan on living in the house, and where interest rates are headed.
Call Mr. Cooper for Fixed-Rate & Adjustable-Rate Loan Questions in Eden Prairie
We've only brushed the surface of fixed-rate loans and adjustable-rate loans! Give us a call to check the most recent fixed-rate mortgage rates in Eden Prairie. Friendly folks are ready to provide you with the latest rates, information, and answers to your loan and homeowner questions.
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