All Posts Tagged: mortgage

Adjustable vs. fixed-rate mortgage: How do I know which is right for me?

Victor Polich
Mortgage Banking

There are many loan types available, and knowing which one is right for you isn’t always an obvious choice.

Rear view of young couple looking out huge glass wall of their house into an expansive yard as they ponder the future and moving boxes behind them.Thinking about your personal situation and goals, you’ll discover that part of the loan process will include you deciding on a fixed or adjustable rate.

What is the difference?

A fixed-rate mortgage is just that – a loan that has a fixed rate for the life of the loan term you choose. An adjustable-rate mortgage (ARM) loan has a lower initial interest rate (creating a lower payment), and then can adjust at various intervals throughout the loan term.

Making sure you are educated about the advantages of both products will help you decide which is right for you.

Fixed-rate mortgage benefits

  • Rate remains constant for the entire term of the loan, regardless of what happens in the broader economy (e.g., interest rate increase).
  • Payment (principal and interest) remains constant for the entire term of the loan, making monthly budget planning easier.

ARM benefits

  • Lower initial interest rates vs. fixed rate option.
  • Payment (principal and interest) is initially lower.

Other items to ask yourself:

  • How long will I be in this home? According to the National Association of Realtors, on average people live in their home for 10 years.
  • Would I benefit from a lower initial payment with an ARM if I plan on moving soon?
  • Am I prepared to make higher mortgage payments if my ARM adjusts with the market or at the end of the initial term?
  • Do I fully understand how my ARM product works today and in the future?

Hopefully this helps clarify these two borrowing options.  In every situation speaking with a mortgage expert today will help set you up to achieve your own personal goals for home ownership in the future.

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U.S. Outlook: The state of household finances today

Scott Anderson
Chief Economist
view from above as older couple looks at a laptop together while going through financial paperwork.

According to a Federal Reserve report, nominal household debt hit a record high $15.3 trillion in the first quarter of 2018.

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U.S. Outlook: Strong consumer-led rebound in Q2 GDP anticipated

Scott Anderson
Chief Economist
Young, smiling man wearing an apron and holding a pen while sitting at a table and talking to a business woman.

Robust real GDP growth above 4% is expected in the second quarter of this year, driven by a sharp rebound in real consumer spending.

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Tackling household debt

Beth Hale
Posted by Beth Hale
Consumer Banking
Young, biracial couple looking into a store window, smiling and holding several shopping bags.

It is important to know what type of debt you have and how you can tackle it, especially if you find yourself struggling to manage it.

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Jumbo loans: 5 things for homebuyers to consider

Victor Polich
Mortgage Banking
Large 3-story house with 2-story detached garage, subtly lit at dusk.

Just as with any other loan, you need to make sure that a jumbo loan is a positive and sustainable fit for your lifestyle and finances.

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