A fixed-rate mortgage (FRM), often referred to as a "vanilla waffer" mortgage loan, is a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or "float". As a result, payment amounts and the duration of the loan are fixed.
Other forms of mortgage loans include interest only mortgage, graduated payment mortgage, variable rate (including adjustable rate mortgages and tracker mortgages), negative amortization mortgage, and balloon payment mortgage. Unlike many other loan types, FRM interest payments and loan duration is fixed from beginning to end.
Fixed-rate mortgages are characterized by amount of loan, interest rate, compounding frequency, and duration. With these values, the monthly repayments can be calculated.
Read more about Fixed-rate Mortgage: Overview, Popularity, Comparisons, Pricing
Famous quotes containing the word mortgage:
“The mortgage is still in our name but, increasingly, the house is theirs. One diaper, one vote.”
—Fred G. Gosman (20th century)