10:15 09 July 2013
So, you’re thinking about buying a house. After saving for a down payment, the next thing that you need to do is to apply for a mortgage. The question here is: how do you pick the right mortgage for you?
There are different types of mortgage products available to you. However, they are mainly categorized into two types: Variable and fixed rate mortgage. Their main difference is the interest rate.
With fixed rate mortgages, you will be charged the same interest rate for the rest of the term. This means that you’ll be paying the same amount every month. With variable mortgages, the interest rate may vary depending on specific economic factors. This can benefit you if the prevailing interest rates are lower compared to the time when you took out your mortgage, as it will translate to a lower interest fee.
Another thing to consider are the fees that lenders will charge for taking out a mortgage. Keep in mind that different banks will charge different processing, legal, and other fees.
To make the process of choosing the right mortgage easier for you, you could use comparison sites online. By doing so, you could easily identify the type of mortgage that will let you save the most amount of money.
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