Fixed or Variable Mortgage, Which Should You Pick?
Buying a home is the single-largest financial commitment most people ever make. And sorting through mortgages involves a lot of critical choices. One of these is choosing between a fixed or variable interest rate mortgage.
True to its name, fixed-rate mortgage interest is “fixed” throughout the life of the loan. In contrast, the interest rate on a variable-interest rate loan can change over time. The mortgage interest rate charged by a variable loan is usually based on an index, 这意味着支付额可能会上升或下降, 视现行利率而定.1
Fixed-rate mortgages have advantages and disadvantages. For example, rates and payments remain constant despite the interest rate climate. But fixed-rate loans generally have higher initial interest rates than variable-rate mortgages; the financial institution may charge more because if rates go higher, 它可能会输掉.
如果现行利率趋于下降, a fixed-rate mortgage holder may choose to refinance, 这可能涉及到结案费用, 额外的文书工作, 和更多的.1
可变利率抵押贷款, the initial interest rates are often lower because the lender is able to transfer some of the risk to the borrower; if prevailing rates go higher, the interest rate on the variable mortgage may adjust upward as well. Variable-rate mortgages may allow borrowers to take advantage of falling interest rates without refinancing.1
One of the biggest advantages variable-rate mortgages offer can be one of their biggest disadvantages as well. Rates and payments are subject to change, and they can rise over the life of the loan.
你应该选择固定贷款还是浮动贷款? 以下是四大考虑因素:
首先，你打算在养老院住多久? If you plan on living in the home a short time before selling it, 你可能想要考虑浮动利率抵押贷款. With a shorter time frame, the loan will have less time to move up or down.
第二，利率的变化? If interest rates are below historic averages, it may make sense to consider a fixed rate. 另一方面, 如果利率高于历史平均水平, it may make sense to consider a variable-rate loan. Then, if interest rates decline, your interest rate may fall as well.
Third, under what conditions can the lender adjust the rate and payment? 多久可以调整一次? Is there a limit on how much it can be adjusted in each period? Is there a lifetime limit on how high the interest rate and payment can be raised?
And fourth, could you still afford your monthly payment if interest rates were to rise significantly? How would it affect your finances if your payment were to rise to its lifetime limit and stay there for an extended period?
对大多数人来说，买房是一项重大承诺. Selecting the most appropriate mortgage may make that long-term obligation more manageable.
1. Investopedia.2023年4月28日
Average Interest Rate: 30-Year, Fixed-Rate Mortgages
美国联邦储备银行(Federal Reserve Bank of St. Louis, the annual rate on the 30-year fixed-rate mortgage was 6.63%(2024年2月).
来源:弗雷德.StLouisFed.org, 2024. For the period between January 2003 to January 2023.
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