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Fixed Rates. |
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The Fixed Rate
mortgage is the most popular home loan originated in today’s
market. This type of mortgage provides a consumer with a
guarantee of a fixed rate and a consistent monthly payment for
the entire fixed period of the loan. The most common terms are
15 and 30 years with many lenders offering terms ranging from
10-40 years. Overall, fixed rate mortgages provide a number of benefits over
adjustable rates including:
 Long
Term Security
Consistent
Monthly Payments
Automatic
Principal Reduction
Most
Flexible Down Payment Requirements It’s interesting to
note that traditional fixed rate home loans amortize much different
than many people expect. During the early years, a greater
percentage of your payment will be applied to interest therefore
many homeowners do not see a substantial reduction in equity
until 5 or 10 years into the note (assuming a 30 year mortgage).
A popular option for consumers to build equity faster is to
enroll in a
bi-weekly mortgage payment plan which accelerates your
principal payments greatly. In fact, for most homeowners it can
turn a 30 year mortgage into a 20 year mortgage. |
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conforming loan limits
Every year, new loan limits are announced for home loans which
may be purchased by the Federal National Mortgage Association
(FNMA, or Fannie Mae) and the Federal Home Loan Mortgage
Corporation (FHLMC, or Freddie Mac). As announced on
November 29, 2005, the conforming loan limits for 2006 according
to the subject property's type are as follows:
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1 Family -
$417,000 (up from $359,650)
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2 Family -
$533,850 (up from $460,400)
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3 Family -
$643,500 (up from $556,500)
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4 Family -
$801,950 (up from $691,600)
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