For many couples, whether first time buyers or not, the prime consideration when looking at a fixed rate mortgage is the monthly installmet cost. Purchasing a home later in life means that many individuals need to have the mortgage settled earlier. However, there are many factors to consider before signing any papers.
Over the course of the loan, it’s important to recall to make sure the interest rate doesn’t alter. If you are offered a deal that appears to be too good to be true than it likely is. Loans arranged for a long run fixed rate mortgage keep the same interest rate throughout the entire life of the loan agreement. There are no hidden surprises which is great for many individuals that want a regular monthly mortgage payment.
Both my wife and I decided to research fixed rate mortgages when we started looking at homes for sale. Although it was essential for us to pay off our loan as soon as we could, we didn’t want high, unrealistic monthly repayments which we would have a problem keeping.
Looking at an even extended term mortgage was one option if we could not afford the monthly repayments on a 15 year plan. The problem was that we weren’t very happy about having a mortgage still running close to when we both retired and hoped that a fifteen year fixed mortgage rate would still be accessible to us. We felt there was a lot of insistence to have the house paid off as soon as possible and for the most part we agreed with this. Discovering my wife was pregnant was the clincher, although this wasn’t the only reason we reached this decision.
Discovering my wife was pregnant was the clincher, although this wasn’t the only reason we reached this decision. Because my wife preferred to be at home for our child, her financial income would be unsure and unreliable. Also, loans for a fifteen year fixed mortgage rate required a higher monthly payment. For us it just wasn’t practicable as we would just be in over our heads and probably be worrying about money every month.
Despite the fear of having a longer term loan, the thirty years fixed mortgage rate did lower the monthly repayments considerably. Fortunately, we are also able make additional payments throughout the year to make the principal shrink faster. We also found that we could lower the number of years left on the mortgage by making these odd repayments. This is well worth the effort in the long run but it does require some discipline. Although we would have much preferred the mortgage for a fifteen fixed mortgage rate we had to take our needs and fiscal capabilities into thought. But in retrospect, everything worked out fine for us ultimately.
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