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10 Year Mortgage Rate - Advantages of a Shorter Mortgage

Pay Off Your Home Quickly With a 10 Year Mortgage

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Interest rates on mortgages are at an all time low. Buyers are taking advantage of the current trend and opting for a 10 year mortgage rate. With lower term mortgages, borrowers can pay off their debt quicker and save money in the end.

A 10 year mortgage is a home loan with lower rates and a shorter term than a traditional mortgage. This option allows you to build equity in your home quickly. When you choose a 10 year mortgage, you will make equal monthly payments for 10 years. Mortgages with 10 year term limits will allow you to make larger payments on the principle of the loan. Making payments on the principle reduces the amount of interest you pay on the lifetime of the loan. You will still have a fixed rate loan. If you receive s 6% rate in the beginning of the loan, it will stay at 6% even if the national average increases (or decreases). Just like a traditional mortgage, it is a good idea to shop around and find the best rates available. Contact a broker and have them advise you on the best rates before you accept an offer.

The main benefit of a 10 year mortgage is the reduced interest you will pay. On a typical home loan for $160,000 with an interest rate of 6%, you will pay back $223,000 in interest (more than the cost of the house!). When you choose a 10 year loan, you will only pay $53,000 in interest. Another advantage of 10 year terms is you will pay off your home much quicker. You will pay higher monthly notes but you will have your home paid off in 10 years. Banks offering short-term loans also give you a better interest rate. You will find that the shorter the terms, the lower the interest rates.

When you take advantage of a 10 year mortgage, pay close attention to your monthly payments. Because you are paying off your house in a third of the time, you will have higher payments. Make sure you can easily afford the payments. If times get hard and you cannot make the payments you will face foreclosure.

If you have the money and resources to buy a house you need to take advantage of lower interest rates. Consider a 10 or 11 year mortgage rate and get the home of your dreams with lower interest and pay it off in a third of the time of traditional mortgages.

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