Fixed-rate mortgages

If you value stability, a fixed-rate mortgage may be the right fit. Your interest rate and monthly payments stay the same for the life of the loan, which means no surprises in your budget.

• Choose a loan term of 10, 15, 20, or 30 years.
• Shorter terms usually offer lower interest rates but higher monthly payments.
• They allow you to pay off your loan faster and save more on interest over time.
• Longer terms generally have slightly higher interest rates but offer lower monthly payments, which may be helpful for tighter budgets.
• Fixed-rate mortgages are often a smart choice if you plan to stay in your home for seven years or longer.
• You can refinance later if your financial situation or market conditions change.
  

Adjustable-Rate Mortgages (ARM)

If you need more flexibility in the short term, an adjustable-rate mortgage could be a better option. ARMs offer a lower initial interest rate, which keeps your payments lower during the first few years of the loan.

• Available as 3/1, 5/1, or 7/1 ARMs.
• The first number refers to the years your rate is fixed.
• After that period, the rate adjusts once a year based on market conditions.
• Rate caps are in place to limit how much your rate can increase annually or over the life of the loan.

ARMs are often ideal for borrowers who plan to move or refinance before the rate
adjusts.