Fixed Rate Mortgage

A fixed-rate mortgage loan is one on which the monthly payment doesn't change, regardless of what happens to market interest rates.  No matter how much interest rates fluctuate, your payment remains the same.  Because of this, it is with certainty that you know what your mortgage payment will be and can plan accordingly.

Your payments are stable and predictable, but initial interest rates tend to be higher on a fixed rate mortgage than on an adjustable rate loans.  The term or length of fixed-rate mortgages is generally set to be 15 or 30 years.

Assumable loans are loans that can be transferred to a new buyer - the new buyer assumes or takes over the mortgage obligations.  There are certain advantages to this type of fixed-rate mortgages, most notably regarding interest rates.  It is possible for the person assuming the loan to take it over with a lower interest rate. Many fixed-rate mortgages, however, cannot be assumed by a subsequent buyer.