What mortgage should I get?A good mortgage lender should explain all the options available to you and recommend the one that best suits your circumstances. In general, mortgages can be classified as:
- Fixed-rate: Your interest rate never changes, meaning your mortgage bill remains the same from the very first to the very last payment.
- Variable-rate: This mortgage has a lower interest rate than a fixed-rate one, but it may increase or decrease depending on how the real estate market performs.
- Interest-only: You’ll pay only the interest at first, but you’ll have to make a lump-sum “balloon payment” for the entire balance at a specified time.
- Negative amortization: With this option, your lender agrees to defer a portion of your interest for a period of time.