Let the Mortgage Hunt Begin

Despite the fact that there are multitudes of mortgage loan options, choosing the right one doesn't have to be a stressful or painful process. New home loans come in many shapes and sizes.
There are three types of mortgage loans: adjustable-rate mortgages, fixed-rate mortgages, and combination-rate mortgages.
Before you can decide which mortgage loan makes the most sense for you, you must first understand the benefits of each and how they fit into your current financial situation.
Adjustable-Rate Mortgages
Adjustable-rate mortgages (ARM's) have low starting interest rates, but increase either yearly or monthly thereafter. The interest rate is adjusted based on a pre-selected index, usually the one-year Treasury bill. This type of mortgage works best if you can afford monthly payment increases, plan to stay in your home less than 5 years, and think your income will increase in the future.
Fixed-Rate Mortgages
Fixed-rate mortgages (FRM’s) come in 15, 20, and 30 year terms. The interest rate and monthly payment remains the same for the entire term of the loan. It is the most widely accepted new home loan and works best if you like stable mortgage payments, plan to live in your home more than 5 years, and think your future income and spending will remain constant.
Combination-Rate Mortgages
The best of both worlds, combination-rate mortgages start with a fixed rate for 5 years, then move to a variable rate after that. The variable rate might be for a specified term or might adjust on a regular, long-term interval.

Ultimately, the new home loan you choose should fit your current financial situation and long term goals.

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