Pueblo VA Loans – Fixed Rate vs. ARMs
When you’re looking at home loans, you’ll find two general categories: those with fixed interest rates and those with adjustable rates. Both fixed-rate and adjustable-rate mortgages (ARMs) have their benefits and before you can start looking at Pueblo VA loans, you need to understand when each type is the best choice. Here’s what you need to know.
Fixed-rate mortgages are home loans that have the same interest rate for the entire loan term. This means that even if the average interest rate for Pueblo VA loans goes sky-high, your interest rate won’t change at all. But it’s not all great news. If the market changes and interest rates plummet, your rate will stay higher than the industry’s current low.
Adjustable-rate mortgages are just that…mortgages with interest rates that can fluctuate over time. When the industry’s rate is higher, you can expect a higher interest rate on Pueblo VA loans with adjustable rates. But you can also expect your interest rate to go down if interest rates drop across the board.
Which Is Best for You?
Fixed-rate mortgages are perfect if you’re looking for Pueblo VA loans that provide a consistent monthly rate. You’ll never have to worry about your payment amounts changing month to month. This makes it easier to set a firm budget and gives your family something predictable to factor into their monthly expenses. However, you can expect a higher interest rate than you’ll find with ARMs. Further, you may end up qualifying for a lower loan amount, restricting your home options.
ARMs typically offer lower interest rates than fixed-rate mortgages, at least initially. They may also offer lower fees and lenders may give you a higher loan amount, letting you get a more expensive house. Pueblo VA loans with adjustable-rate mortgages are ideal for people who are willing to take the risk of a changing interest rate and those who want a potentially nicer or larger home.
If you’re ready to buy a house and need to start looking for Pueblo VA loans to help you finance the purchase, don’t panic. Apply for a loan today.