What Is The Difference Between Adjustable Rate Vs. Fixed Rate?
Author: Nancy Tychowski Mortgage Consultant |
A fixed rate means your mortgage will always have a pre-determined interest rate irrespective of the changes in economic conditions. On the other hand, an adjustable rate can be changed by the lender whenever he feels that the economic conditions have changed.
If you are looking for peace of mind or a stable monthly payment and do not want to be dealing with uncertainty, it is advisable to go for a fixed-rate mortgage. But if you have a sufficient financial cushion to absorb any increase in your monthly payments, and if you feel that interest rates are likely to go lower in the near future, then an adjustable-rate mortgage might be a better option for you.