Fixed vs. Adjustable-Rate Mortgages: Calculate the Difference
Choosing the right mortgage is a critical financial decision for homebuyers. The two main types of mortgages—Fixed-Rate Mortgages (FRMs) and Adjustable-Rate Mortgages (ARMs)—offer different benefits and risks. Understanding their differences and using a mortgage calculator can help you determine which option is best for your long-term financial goals. IMAGE SOURCE AI In this article, we will break down both types of mortgages , explain how a mortgage calculator can help compare costs, and provide a comprehensive list of pros and cons for each option. What is a Fixed-Rate Mortgage? A Fixed-Rate Mortgage (FRM) is a home loan with an interest rate that remains constant throughout the life of the loan. This means your monthly payments stay the same, making it easier to budget over the years. Key Features of a Fixed-Rate Mortgage Interest rate remains unchanged for the loan term (typically 15, 20, or 30 years). Monthly principal and interest payments remain the same. Provide...