Getting a mortgage can seem like a complex process, but when you know where to turn, it can help. That’s especially true if you know what to expect before you get started, like learning about LoanDepot mortgage rates before finding the house of your dreams.
You’re generally looking at the fixed interest rate or adjustable-rate mortgages when you buy a house. However, each can have benefits and drawbacks that you should consider before deciding which ones are best for you.
Fixed-rate mortgages mean that your interest rate is locked in at whatever it was when you signed your mortgage documents. It can never change. Whereas adjustable-rate mortgages, the rate can change according to a pre-set schedule, which may offer adjustments every month. This change means your rate could go up from what you were paying.
Fixed-rate mortgages typically come in 10, 15, 20, or 30-year terms. The longer the term you set, the higher your interest rate. You’re getting more time, which means that the loan is considered more favorable to you. The payments will be lower to split over that longer period, and the interest rate rises to make it more balanced for the lender.
Adjustable-rate mortgages typically come in 3, 5, 7, or 10-year terms. The longer the term you set here, the more potential for changes. Keep in mind that these mortgages do not have a fixed interest rate. You will typically have a locked rate at the beginning of the loan, which may be a few months, a year, or longer. Once that period is up, however, your interest rate will change.
LoanDepot Mortgage Rates for Different Mortgage Types
Now, adjustable-rate mortgages typically have some rules, which include just how much they can increase each time (what percentage amount) and how often they can change (which may be a pre-set number of months that the rate has to stay at one level before it can increase/decrease again). But these accounts carry more risk because the rate usually goes up over time. With LoanDepot mortgage rates, you can find out more about the options that are currently going on.
For some, the risk of an adjustable-rate mortgage can be worth it because the benefit is that your interest rate at the introductory period is usually much lower. If you can pay your mortgage more quickly, you can benefit before the rate increases too much over time.
For others, the predictability of the fixed-rate mortgage is the best way to go because even though the rate may be a bit higher, it’s a set rate the entire time, rather than a variable rate where you never know what to expect.
If you’re looking for a mortgage, you’ll want to look at LoanDepot mortgage rates to find out more about each of these different categories of loans.