Purchasing a home is a major decision and at Blackmon Home Loans, we offer several mortgage types for homebuyers to take advantage of. We offer Adjustable-Rate Mortgages (ARM) and Fixed-Rate mortgages along with many other financial options to suit our client’s financial needs.
- Fixed-Rate For Buyers Who Need Consistency
- Adjustable-Rate Mortgages (ARM) Allow Buyers To Save
- Consider Initial Interest
- ARM Payments Can Change Often
Fixed-Rate For Buyers Who Need Consistency
Homebuyers who prefer a consistent rate for the life of their financial product may prefer a fixed-rate option. Because the rate will be pre-determined, you will know exactly what your payment will be for the entire time. If you need or enjoy consistency, then this is a good choice for you.
Adjustable-Rate Mortgages Allow Buyers To Save
Adjustable rates are not consistent and will fluctuate throughout your loan depending on the current index value. For example, if the market goes up or down, that affects the interest rate. For example, if the rate decreases, then you will make a lower payment during that period when the rate stays low. If you like the idea of having those periods of your payments being lower and don’t mind the variability in both directions, you could save some money over the life of your ARM loan.
Consider Initial Interest Rates
At the start of the repayment, a fixed-rate plan is typically higher and states that way for the entire loan. The ARM interest rate is set lower than market rate on a similar fixed-rate loan. From that point, a rate will rise or fall as the life of a loan wears on. For this reason, it can be more difficult to budget for ARMs. If you need your amount to be a consistent line item on your budget, fixed-rate loans may better serve you although they start off higher than ARMs.
Get Protection From Sudden Changes
Fixed-rate loans protect homebuyers from any sudden changes in mortgage expenses. ARMs are a more complicated mortgage. However, these mortgages are usually much cheaper than fixed-rate mortgages during at least the first 3 to 7 years of your loan.
ARM Payments Can Change Often
Monthly ARM payments may change often and that makes it difficult to budget. But one benefit of the ARM’s initial lower interest rate is that new homeowners may find it easier to qualify with an ARM than with a higher interest rate on a fixed-rate loan.
Call Us To Discuss Your Options
At Blackmon Home Loans, a Las Vegas mortgage company, we will walk you through various mortgage types for your home purchase. We’re here to help you learn more about Adjustable-Rate Mortgages (ARM) or Fixed-Rate Mortgages, and determine