What Is A Fixed-Rate Mortgage?
In Canada, fixed mortgages are by and large the most popular loan type among homebuyers. In essence, a fixed-rate mortgage is a straightforward loan payment plan where the interest rate is locked in place from beginning to end. Fixed rates ensure constant, steady payments, which is ideal for applicants with a strict or set income.
What’s The Difference Between Fixed-Rate And Variable Rate Mortgages?
A fixed mortgage rate works in contrast to a variable mortgage rate. The rates in variable mortgages are not fixed in place like their counterparts. Instead, variable rates fluctuate periodically, according to market conditions.
Since variable rates are subject to go up or down, homebuyers can save money when rates drop. On the other hand, there is always the risk that rates go up, and applicants should be prepared financially to handle a price increase.
Is A Fixed-Rate Mortgage Right For Me?
Fixed mortgages are an ideal choice for applicants with a set or tight budgets because the stable nature of fixed mortgages makes it easy to budget each month. With a fixed rate, you have the peace of mind knowing precisely how much and how long it will take to pay off your loan in full.
Fixed or variable? Send us a message or give us a call to find out what mortgage structure is best for you!