At the time of this writing, mortgage rates have been higher than a lot of homebuyers would like. But they could certainly go even higher. If you are in the market for a home right now, you may be debating whether to get a fixed rate mortgage or an adjustable-rate mortgage (ARM).
While both have pros and cons, fixed rate mortgages are still an excellent choice for many homebuyers. Here are some reasons why.
- Prevent interest rates from climbing. When you buy a home with a fixed rate mortgage, the interest rate will stay the same for the lifetime of the home loan. You do not have to worry about climbing rates; the market rates will not affect your rates in the future. What if rates go down instead? You do have the option to refinance your mortgage in the future so you can reduce your interest rate.
- Simplified budgeting and financial planning. Another advantage of a fixed mortgage rate is that your mortgage payments will remain predictable over the years ahead. That predictability makes planning for the future much easier than it would be if you had a lot of uncertainty around your future rates. Budgeting for long-term expenses such as home improvement, education, investments and so on becomes more manageable. You are less likely to make the mistake of over-budgeting for such expenses.
- Peace of mind. For a lot of people, one of the key benefits of a fixed rate mortgage is psychological. Simply not having to worry that your rates will go up in the future makes for a lot less stress. You can keep your focus on other things. All of this said, adjustable-rate mortgages are sometimes still a good fit for some homebuyers. Do you only plan to stay in your home for a few years? The low introductory rate on an ARM may save you money. If you are out of the home before the introductory period ends, you will never need to pay a higher rate.
Buy a Home in Missouri with a Competitive Mortgage
At your consultation, we can discuss the different interest rate formats for mortgages with you in more detail, and offer you personalized recommendations based on your loan scenario and goals.
No matter your situation, we can help you buy a home in Kansas City or anywhere in MO. McGowan Mortgages is also licensed to work with clients in 40 different states. To get started, please call (816) 631-9687.
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