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Make Sure You Don’t Get Bad Credit Mortage Loans

September 16th, 2008 Subscribe To Our Feed

The question of which is preferable: the 15 or 30 year fixed mortgage rate is one that home buyers are always unsure about. Buying a home later in life means that many people want to have the mortgage paid off early. Take some time to think about everything carefully before any agreement is signed. One important point is to ensure that the interest rate does not change during the life of the loan. Avoid bad credit mortgage loans at all costs.

It seems that some lenders are happy to offer deals that appear too good to be true and they usually are. Interest rates remain the same throughout the life of the loan for 15 year fixed rate mortgages. There are no hidden costs involved with this type of plan which is great for many people that want a regular monthly payment. My wife and I had already decided to research long term fixed mortgage rates when we started looking at homes for sale.

Having a realistic, sustainable monthly payment on our mortgage was important even though we wanted to pay off our debt as soon as possible. So in consideration of this point we also looked at longer, 30 year fixed rate mortgages as well. The 15 year fixed mortgage rate was the plan we really wanted because neither of us wanted to be still paying a mortgage when we close to retiring. There was obviously very good reasons to finish paying the loan off early.

Eventually we decided on a 30 year loan after looking at all the other possibilities. Reaching the decision we did was the only one that made sense.Probably the over-riding decider was the fact my wife was expecting a child. As she intended to raise our child at home we could not rely on her financial income to the monthly expenditure. Loans that were based on 15 year fixed mortgage rates required a much higher monthly payment. We just decided we would probably get into trouble if we took this route. The 30 year loan repayments were considerably lower than the 15 year figures.

We found that if we could make a few extra payments throughout each year then it would gradually reduce the principle sum owed. My making just a few of these payments each year we discovered that a number of years could be taken off the mortgage term. In the long term, this is a strategy well worth pursuing if you are able. Although we would have much preferred a loan with a 15 year fixed mortgage rate we had to take our needs and abilities into consideration. As it is, things worked out very well for us by taking this route.