Fixed Rate Mortgage

Fixed-rate mortgages are the most common type of home loan here in Colorado. Because the interest rate stays the same for the duration of the loan, the monthly payment remains constant as well. That is, unless property taxes, homeowners or condo association fees and/or insurance premiums change. 

Typically, the shorter the term, the lower the interest rate. 

The most common fixed-rate mortgages are 30-year and 15-year terms, with the former being most popular when borrowers can lock in a low rate. 30-year loans make for lower monthly payments for the same loan amount. However, in the end, borrowers pay more total interest over the life of the loan at a higher rate on 30-year terms. 

One downside to fixed-rate mortgages in Colorado is that the borrower’s interest rate stays the same, even though interest rates in the market are dropping. Compared to adjustable-rate mortgages (ARMs), interest rates on ARMs are usually lower, though they can go up over time.

To learn more about fixed-rate mortgages available here in Colorado, contact our Fort Collins office today!

With a Fixed-rate mortgage, the interest rate does not change for the term of the loan; the monthly payment is always the same. Typically, the shorter the loan period, the more attractive the interest rate will be. 

Payments on fixed-rate fully amortizing loans are calculated so that the loan is paid in full at the end of the term. In the early amortization period of the mortgage, a large percentage of the monthly payment pays the interest on the loan. As the mortgage is paid down, more of the monthly payment is applied toward the principal.