Fixed-rate mortgage

Frequently Asked Questions

• Why choose a fixed-rate mortgage?

  A fixed-rate mortgage gives you the security and stability of having the same monthly payment over the life of your loan. You can choose a longer term for lower monthly payments that fit your budget. Alternatively, you can choose a shorter term with higher monthly payments, which means you’ll pay less interest in the long run.

   

• What are points?

  Points provide a way for you to lower the interest rate, and in turn lower your monthly mortgage payment. One mortgage point is equal to 1% of your mortgage amount. For example, on a $200,000 loan, one mortgage point is equal to $2,000. You can pay 1 point, or $2,000, at closing in exchange for a lower interest rate over the life of your loan.

• What’s the difference between APR and interest rate?

  Your APR, or annual percentage rate, reflects your interest rate plus any fees that you pay to obtain your loan. Your interest rate is simply the annual cost of your loan expressed as a percentage. This doesn’t factor in the fees you paid to originally obtain your loan.

• What is the maximum conforming mortgage loan amount?

  A conforming mortgage is the mortgage loan limit set by Fannie Mae and Freddie Mac. For single family properties in most counties, the conforming limit is $647,200 and any mortgage loan amount of more than $647,200 is a jumbo mortgage.