Capped rate or fixed rate?
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dominik
Apprentice
Joined: 30 Dec 2007
Posts: 6
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 Posted: 04/07/09 - 05:56 Post subject: |
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| Hello there everyone. For some time I am thinking about getting a mortgage. I did a little research and I think that all the options are little bit confusing. That’s why I need your help. What do you think is better: capped rate or fixed rate? What is difference between those two? Thank you. |
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rollie
Apprentice
Joined: 25 May 2005
Posts: 8
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| Posted: 04/17/09 - 04:06 Post subject: |
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| Hello there. I agree with you that it is sometimes complicated to find a good loan, especially big loan such as mortgage. There are so many options and so many providers. Capped rates are variable and they tend to be lower than fixed rates. In case of fixed mortgage, you have constant rate but which would be little bit higher. |
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edmund
Apprentice
Joined: 08 May 2008
Posts: 5
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| Posted: 04/27/09 - 02:15 Post subject: |
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| Hello hello. In my opinion, it really depends on your preferences. If you prefer to know your interest rate during the whole time of loan, then you should go for fixed. It is true that they are higher, because there is interest-rate risk for lender in that case. What you should do is collect all the details and see what works for you. I hope I was of some help. |
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dominik
Apprentice
Joined: 30 Dec 2007
Posts: 6
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| Posted: 05/07/09 - 00:24 Post subject: |
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| Hello to you too. I would say that capped rate is good option. It can be inconvenient to have your interest rate change from time to time, but that’s what caps are for. Capped rate is a variable rate which has upper and lower limit. So, as long as you can make the payments with the higher cap, you will be fine. That would be all. Good bye! |
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