A fixed rate mortgage has an interest rate that will not change for the life of your loan.
Although the most common fixed rate mortgage is the 30 year fixed rate, fixed rate mortgages are offered in the following terms: 10 year fixed rate, 15 year fixed rate, 30 year fixed rate and 40 year fixed rate. The shorter your term, the less interest you will end up paying over the life of the loan.
USDA only offers a 30 year fixed mortgage program at this time.
The biggest benefit of a fixed rate mortgage is that you will know precisely what your mortgage interest and principal payments are going to be and hence plan your budgeting in accordance.
Because the monthly payments do not increase over the life of the loan you are protected against mortgage interest rates going up
Other benefits of fixed rate mortgages incude the following.
Contact a USDA Loan Specialist Online or toll free at 800.461.4152 to learn more about how the No Down Payment mortgage programs can help you.