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38 | WINTER 2021 Home Mortgages and Home Equity Line of Credit (HELOC) Home Lending FIXED-R ATE MORTGAGE LOANS This "traditional" type of loan maintains its original interest rate throughout the entire life of the loan. (Any change in monthly loan payments will be due to increases in other charges like insurance or taxes that naturally occur over time.) A fi xed-rate mortgage loan may be a good choice if you want the security of knowing your interest rate will not change and how much your monthly mortgage loan payment will be. Mortgage loans come in various loan terms. In determining the length of your loan, you may want to consider the total amount of interest you want to pay over the course of your loan. You will pay more interest on a longer fi xed-rate loan term, but you will have lower monthly payments. You can pay off a shorter-term loan quicker, but will have higher monthly payments. The fi rst option to consider is your ability to make higher monthly payments. If you can aff ord to pay more per month, you can reduce the number of months you have to pay, and choosing a shorter-term loan will save you thousands in interest charges. Your second option is to decrease the total amount of interest you pay on a longer-term loan, so you don't lock yourself into higher monthly payments, but pay a little extra each month toward the principal when you are able to do so. ADJUSTABLE-R ATE MORTGAGE LOANS While the name almost says it all, there are certain things about Adjustable-Rate Mortgages (ARMs) that you should know. 1. The rates are lower. This rate provides you with lower initial payments for increased purchasing power. Whether you're a fi rst-time homebuyer, seeking a more aff ordable monthly payment or thinking about buying a second property, we make it simple to get the mortgage loan that fi ts your goals and your budget Visit us at AACreditUnion.org/ borrowing/home-loans for more information. 2. ARMs are diff erent. Our programs provide an initial fi xed rate with convenient terms before the rate adjusts at all. These options are best for those who want added payment stability and lower initial monthly expense. 3. They fi t your changing needs. First-time homebuyers no longer tend to stay in their "starter" home for more than fi ve or 10 years, and experienced homeowners often plan to pay off their mortgages long before the maturity dates. An adjustable-rate mortgage may be a good choice if you want to maximize your buying power, keep your payments lower during the fi rst few years of your loan, plan to move or pay off your mortgage within the next 10 years or if you expect your income to increase signifi cantly in the coming years. JUMBO LOANS Need a loan that's larger than conventional loan limits? Our jumbo loan rates may surprise you. Use the Loan Consultant (HomeLoAAns.org) to get quotes on current interest rates and closing costs. The free website off ers added value: • Pre-approval • Faster response • Locks in your rate With a wide range of mortgage products, we make choosing the right mortgage the easiest part of shopping for your new home.