Monday, December 29, 2008

Houston Mortgage Rates

A mortgage rates vary according to the type and the duration of the loan. There are three types of mortgage rates:

1. Adjustable Mortgage Rate

2. Fixed Interest Rate

3. Variable Interest Rate

A mortgage with an adjustable interest rate takes into consideration that an interest rate may change (usually in response to changes in the Treasury bill rate or prime rate. The purpose of the interest rate adjustment is primarily to bring the interest rate on the mortgage in line with market rates. The mortgage holder is protected by a maximum interest rate (called a ceiling) that might be reset annually. ARMs (Adjustable Mortgage Rates) usually start with better rates than fixed rate mortgages, in order to compensate the borrower for the additional risk that future interest rate fluctuations will create.

A fixed interest rate mortgage has an interest rate that will not change, and a variable interest rate moves up and down based on the changes of an underlying interest rate index.

There are numerous Houston based mortgage companies willing to present a ready report of mortgage rate calculator. These companies offer refinancing that involves obtaining a new mortgage loan on a property already owned - often to replace existing loans on the property. When the mortgage rates are low, it is a good time to refinance. Refinancing can save you money on your monthly mortgage payments. These companies also offer lock-in rates, or rate lock option that ensures the borrower a commitment to a specified mortgage rate, including not only the interest rate but also its discount/origination points.

Houston Mortgages provides detailed information about Houston mortgages, Houston mortgage companies, Houston mortgage brokers, Houston mortgage lenders and more. Houston Mortgages is the sister site of Atlanta Interest Only Mortgages.

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