Taking out a mortgage to purchase a new home is one of the biggest decisions you will make in your life. A home loan is something you will have to settle within the next 30 years or so of your life, unless you eventually decide to sell or refinance the home. Here are three types of home loans you can choose from.
Fixed-interest
For most borrowers, this can be the most ideal type of mortgage because it allows you to pay a fixed monthly fee regardless of the condition of the housing market. This kind of loan protects the borrower from the effects of inflation. This also means, however, that you will be paying the same amount even when market interest rates hit rock bottom.
Adjustable
Borrowers who believe that mortgage rates will eventually go down can go with an adjustable mortgage instead of a fixed-interest one. This type of mortgage is characterized by an interest rate which conforms to the condition of the housing market. Normally, due to the flexible nature of this mortgage, the terms and conditions are far more complex than those of fixed-interest loans.
Interest-only
Some homebuyers are just starting their careers and thus, may be expecting bigger incomes in the future. An interest-only mortgage may be more appropriate for them. This requires smaller upfront and regular payment in the first five to ten years, to be compensated for by bigger payments after the set initial period.
The Home Loan Arranger 