What is a 30-year Fixed Mortgage?
The 30-year fixed rate mortgage is historically the most popular loan in the mortgage industry. It is a safe and affordable way to finance the home of your dreams. You pay low monthly payments that are spread equally throughout the 30 year loan term. The interest rate is locked at closing and never changes for the life of the loan, so there are no surprises. This is often the most secure, simple and affordable loan option.
BENEFITS OF A 30-YEAR FIXED MORTGAGE
- Interest rate is fixed for the life of the loan
- Lower monthly payments compared to a 15-year fixed
- Down payments as low as 3% - 5%
- No prepayment penalties
- Consistent monthly mortgage payments
- Can avoid Private Mortgage Insurance (PMI) with a minimum of 20% down
- Allows you to get more house for your money, since payment is spread over 30 years
How it Works
A 30-year mortgage can be utilized for both the purchase of a new home, or the refinance of your current home. You will have a set, fixed interest rate for the entire life of the loan, and will have consistent mortgage payments every month. The amount paid monthly to the loan will not change, however keep in mind that the amount you pay for property taxes and homeowners insurance is still subject to change. After the 30-year loan term, the home will be completely paid off. You also have the ability to pay more towards your mortgage whenever you would like, allowing you to pay off the loan even faster than 30 years, with no prepayment penalties!
- If you plan to stay in the home for a minimum of 5-7 years
- To purchase a larger home with a lower monthly payment. Borrowers can generally get a larger loan with a 30-year mortgage since it can be paid back over a longer period
- Consistent monthly mortgage payments with no surprises
Not every loan option is right for every borrower. To get your questions answered and receive more information on what type of loan is best for you, contact us at 1-888-320-9343 or click the button below and allow us to help find a customized loan to fit your specific needs.