1. Mortgage Types

2. 30 Year fixed rate The interest rate is “locked in” for 30 years at the same rate.

3. 15 year fixed rate The interest rate is “locked in” at the same rate for 15 years.

4. Adjustable rate The rate is adjusted every period and could move up or down. Periods are different for each lender. They could be monthly, quarterly, semi-annual or annual.

5. Balloon rate You agree to a monthly payment for a certain period of time. When the term has expired the entire remainder of the loan is due. These usually are for 5 or 10 year terms.

6. PMI Insurance that protects the lender in case the borrower defaults and is unable to pay. Usually a borrower must pay PMI unless their equity is more than 20%.