30 year fixed mortgage rate

A 30 year fixed rate mortgage is one where the rate of mortgage is fixed for the life term of the loan which is 30 years or up to a specific future time period. A fixed rate results in a fixed monthly payment/ liability. It is the most popular form of mortgage. Close to 75 % of all mortgage loans are fixed rate mortgages with 30 year duration.

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Major Advantage of a Fixed Rate Mortgage

One of the most beneficial aspects of Fixed Rate Mortgage is that you are sure about the rate of interest and thereby the consequent liability incurred every month. You can plan your interest and principal payments accordingly and budget for the same.

Characteristics of a 30 year Fixed Mortgage

• It is easy to understand and follow.
• This scheme is best suited for those who intend to have their houses for a longer duration and budget for the same.
• The monthly payments are initially higher when compared with Adjustable Rate Mortgage.
• The lenders generally charge a comparatively high rate of interest in comparison with the Adjustable Rate Mortgage.
• Buyers feel far more secured under a fixed rate mortgage, especially first time home buyers.
• They are not as flexible as adjustable rate mortgage.

30 year Fixed Mortgage Rate

Due to recession in the Home Market, the 30 year fixed mortgage rate has come down from 6.67% last year to 6.40% in the current year. While the 15 year fixed mortgage rate has been down from 6.12 % to 5.93%.The conforming loan limit for a one family home is $417,000. The lenders of conforming loans also offer jumbo loans. On a comparison of various schemes fixed rate mortgage for a 30 year period offers the advantage of lower interest rates and also lower monthly pay out, thereby not only reducing the liability every month, but also the cost of the loan in total.