Not sure which mortgage type to sign up for?? A fixed rate mortgage, the mortgage rate and payment you make each month will stay the same for the term of your mortgage . With a variable rate mortgage, the mortgage rate will change with the prime lending rate as set by your lender How to choose between a fixed vs. variable mortgage debate between fixed vs. variable mortgages may seem easy, but many different factors can affect your decision.

Your risk tolerance is very important when considering what kind of mortgage you will take.
If you are going to lose sleep because you are worried interest rates will go up quite a bit, then going fixed is a good way to set and forget your mortgage payment You will also know exactly how long it will take to pay off your mortgage. On the flip side, there can be substantial savings in interested taking a variable mortgage as long as there is a good discount off the prime lending rate.

You may sell your home within the term. If you ever need to break your mortgage, you’ll pay a penalty. Fixed-rate mortgages typically calculate the penalty using the amount of interest you’d pay over the remainder of the term, which can be astronomical. With variable-rate mortgages, you usually only have to pay three months’ worth of interest to get out of your contract.

If you want the peace of mind that comes with knowing that your mortgage rates will stay the same for your full term, go for a fixed-rate mortgage. If you’re willing to speculate that rates will stay the same or decrease, a variable-rate mortgage may be more appealing. #reagan_mortgagesolution