I want to get a loan and buy a house. I’ve read plenty of information in banking sites about the interest but i would be grateful if someone could make it clear for me what’s the difference in the fixed and floating interest rate in a 200.000 Euros mortgage loan
In: Economics
A fixed rate loan charges you the same interest rate through the life of the mortgage. Your payment (principle and interest only, not including escrow) will stay the same through the loan. A floating rate mortgage gets its interest rate adjusted every so often. This can be good or bad, depending. If interest rates drop, you payments go down. If interest rates go up, your payments go up.
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