(Newswire.net — November 21, 2013) Hutington Beach, California —
Historically low interest rates have tempted buyers into the market, strengthening recent home sales in Orange County. However, according to the Huntington mortgage experts at CB Investments, choosing the right mortgage is still important. While Huntington Beach mortgage rates on different products vary, a lower interest rate may come with issues that make it difficult for the homeowner to pay back the loan. The lowest initial interest rate is not always the best choice.
California mortgage rates are based on many factors. The 30-year fixed rate mortgage is still the most popular loan product for very good reasons. This product, unique in the United States housing market, often has the security of government-sponsored enterprises such as Fannie Mae and Freddie Mac to back it up. Strong underwriting standards have helped make this type of mortgage stronger than ever.
Along with the 30-year fixed mortgages, lenders also offer 25-year and 20-year fixed interest rate product at slightly lower rates. Since the discount is slight, borrowers are often better off doing a 30-year loan and then making principal reduction payments on their own if they wish to reduce the loan term. They then are able to keep the flexibility of the lower 30-year amortized payment if they need it.
If buyers are considering a shorter term fixed-rate loan, the 15-year fixed-rate mortgage is the product to consider. A 15-year mortgage provides a substantial interest rate discount and greatly minimizes the total interest paid over the life of the loan compared to a 30 year amortized loan. For many, another benefit is that this term coincides with their retirement plans. Not only are they able to eliminate their largest debt, but the interest tax deduction will not be as valuable when their income drops in retirement.
Buyers who are in the market for an indefinite home ownership period should definitely consider the fixed-rate loan. Even if the initial interest rate is higher for a fixed-rate loan than for an ARM, the risk level is much lower, making this the perfect product for an Orange County mortgage holder who wants to find a safe product and keep interest rates relatively low.
About CB Investments: CB Investments are professional Orange County mortgage brokers who can work with clients of all income levels to find the right mortgage product for home ownership needs. With the help of CB Investments, Orange County homeowners can find the right financing for homes and can help buyers qualify for the best mortgages at the lowest rates.
For More Information: www.cbinvestments.com