How a 30 Year Fixed Rate Mortgage Works
30 Year Fixed Rate mortgages are among the most popular home loans available for buying a home or refinancing an existing mortgage. They offer borrowers the security of stable, affordable monthly payments and protection from market changes.
30 Year Fixed Rate Overview
A Fixed 30 mortgage is a loan featuring an interest rate that stays the same over the life of the loan, as opposed to an ARM mortgage, which has an interest rate that can adjust periodically. A 30 Year Fixed loan allows a borrower to make payments over a 30 year term, and they are among the most popular loan options for borrowers seeking to purchase or refinance a home loan, since they offer the stability of an unchanged monthly payment, regardless of market fluctuations.
With a 30 Year Fixed Rate mortgage, your payment will be the same every month, so you can plan your finances accordingly and you won't need to worry about your payment going up if the market changes.
You can use our Fixed Rate mortgage calculator to get an idea of what your mortgage payment might be.
30 Year Fixed Rate Benefits
Many borrowers choose a 30 Year Fixed loan to buy a home or refinance because of the advantages:
- Affordable Payments: With terms from 10 to 30 years, you can choose how quickly you pay off your mortgage.
- Security: Particularly popular with first time home buyers, the security of a fixed rate loan is attractive to many borrowers. Even if current rates go up, yours won't. You'll have consistent monthly payments with no surprises, so you can plan your finances accordingly.
- Loan terms are straightforward and easy to understand.
30 Year Fixed Rate Requirements
In order to get a 30 Fixed Rate mortgage, or a 15 Year Fixed, you'll need to go through a few simple steps. If you're shopping for a home, the first thing most borrowers do is get preapproved for a loan.
Having a credit preapproval can:
- Save you time shopping for properties in your price range
- Create credibility with sellers by letting them know you're qualified and serious
- Speed up the closing process and get your loan funded sooner
- Improve your experience in the home buying process
If you're looking to refinance your mortgage with a Fixed Rate loan, you'll want to have proof of income and copies of:
- Homeowner's Insurance: Verify adequate coverage
- Proof of Income: Show past employment and income history
- Asset Information: Bank account statements, 401k, and other investment records
Fixed Rate Loan Options
15 Year Fixed Mortgage
Offering all the advantages of a 30 Year Fixed Rate mortgage, the 15 Year Fixed allows you to repay your mortgage in half the time of a 30 year term.
The shorter, 15 year term means you will:
- Have a lower interest rate than a 30 Year Fixed
- Pay less interest over the life of the loan since the loan is being paid off faster
- Build equity faster than in a 30 Year Fixed mortgage
30 Year Fixed Mortgage
One of the most popular loan options, the 30 Year Fixed offers the security of a fixed rate plus an affordable payment. You will always know your monthly mortgage payment and you can budget accordingly.
30 Year Fixed Rate loans offer:
- Even more affordable payments than 15 year fixed loans
- Security of consistent payments
- Protection from inflation
Call us at 1-800-890-1057 for help today!
Don’t forget to ask about our I CAN mortgage, so you can customize the terms of your loan.