There are many types of mortgages. The best mortgage for you depends on your needs. Common home loans include: fixed interest rate loans, adjustable rate loans and interest-only loans.
Fixed Rate Mortgage - available with a wide variety of amortization periods. These include:
Adjustable Rate Mortgage (ARMs) - feature an interest rate that adjusts according to a specific schedule. ARMs may be subject to specific restrictions on interest rate changes. Common types include:
Interest-Only Mortgage - allows borrowers to make low monthly mortgage payments by only requiring interest and not a portion of the principal during the interest-only period. Interest-only mortgages may have a fixed interest rate or an adjustable interest rate (Interest-Only ARM). Interest-Only ARMs may have an interest-only periods that is the same length or longer than the fixed-rate period. Common types of interest-only mortgages include:
Balloon Mortgage - does not fully amortize over the term of the loan, resulting in a large (balloon) payment of the remaining principal at maturity. Common types of balloon mortgages include: