FHA Fixed rate mortgage
FHA FIXED RATE MORTGAGE
A fixed rate mortgage is a fully amortized mortgage loan where the interest rate is on the loan is constant or remains the same throughout the whole life of the loan. A fifteen, twenty, or thirty year loan will always have the same principal and interest payment. No surprises here, you know what you are in for.
With so many people using FHA as a bad credit home loan solution, the fixed rate mortgage is a great option as there are not any variables. One thing to be aware of – taxes and insurance are also expenses that are related to home ownership. These expenses can be paid monthly, semi-annually, or annually and unlike the fixed rate mortgage they do tend to adjust, many times upward. If you are to include (through escrow) your tax and insurance bills in your monthly payment, then you may see your monthly payment go up due to the rising taxes or insurance.
With most experts believing that interest rates will rise in the coming years the fixed rate mortgage is deemed to be preferred over the adjustable rate mortgage at this time.