Home Mortgage Loan Rate

15 year fixed rate mortgage compared to 30 year fixed rate mortgage:

Advantages:
With a 15 year fixed rate mortgage you will own your home, free and clear, in half the time it would take with a traditional 30 year mortgage.

The interest rate on the 15 year fixed rate mortgage is usually a little lower, typically up to .5% lower.

You will save more than half the amount of interest with the 15 year fixed rate mortgage compared to the traditional 30 year mortgage.

The lower interest rate plus the shorter loan life creates substantial savings for 15 year fixed rate borrowers.

Disadvantages of a 15 year fixed rate mortgage:
The monthly payments are somewhat higher, roughly 10 percent to 15 percent higher per month than the payment for a 30 year fixed rate mortgage.

Many borrowers find that the higher payment is out of reach of their buget, and choose a 30 year mortgage.

Because you'll pay less total interest on the 15 year fixed rate mortgage, you won't have the maximum mortgage interest tax deduction possible.

The 15 year fixed rate mortgage is most popular among younger homebuyers with sufficient income to meet the higher monthly payments to pay off the house before their children start college. They own more of their home faster with this kind of mortgage, and can then begin to consider the cost of higher education for their children without having a mortgage payment to make as well. Other homebuyers, who are more established in their careers, have higher incomes and whose desire is to own their homes before they retire, may also prefer this mortgage.

Interest rates are constantly changing. The annual percentage rate (APR) can change while you are in the process of applying for and closing an application for a mortgage loan. Keep in mind that the fixed rate mortgage interest rate and monthly payment does not change during the entire term of the loan, and the adjustable rate mortgage (ARM) (also known as a variable rate loan) usually offers a lower initial rate than fixed rate mortgage loans, but the interest rate can change at specified time periods based on changes in an interest rate index that reflects current finance market conditions. When the interest rate on an adjustable rate mortgage (ARM) increases, your monthly payments will increase and when the interest rate on an adjustable rate mortgage (ARM) decreases, your monthly payments will be lower.

Things can rapidly change in peoples lives from one day to the next, keeping this thought in mine may help you to decide which loan is best for you.

Federal Laws
Major laws that govern financial institutions and protect individuals in their financial dealings

Organizations

Fannie Mae
Freddie Mac
Ginnie Mae
Nellie Mae
Sallie Mae

Consumer Info

Credit Bureau
Credit Report
Directory of Federal Agencies
Federal Trade Commission (FTC)
Identity Theft
Predatory Lending
Repair Your Bad Credit
Truth in Lending Act
Borrowers Beware

Miscellaneous

Private Mortgage Insurance (PMI)
Prepayment Penalty

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