What’s the difference between paying rent and paying a mortgage? There are two big differences:
What’s a mortgage?
A mortgage is a loan on a house or a property where the collateral or the security for that loan is the house or the property. It has a big, long lending period called an amortization period, typically 25 years, but it can be sort of 15 to 30 years or even shorter. It can be a five-year mortgage. Within that amortization period, you have different terms where you negotiate whether you are going to be paying a fixed rate, so the same amount for the entire term, or a variable rate, which would be prime minus x. So it’s gonna fluctuate and the terms can be anywhere from a few months to a year, two years, five years, or 10 years.
If you’d like more information on mortgages and what they entail, contact us. We have a list of local lenders who would love to talk to you.