There are several types of fixed-rate loans to choose from, including:
Mortgages
Mortgages are secured loans where a borrower’s real estate acts as collateral. When taking out a mortgage, you can choose between fixed and variable-rate options.
Since most mortgages have a 30-year term, it’s hard to predict how the market might behave during that time. Because of this, most borrowers choose a fixed-rate mortgage.
With a fixed-rate mortgage, you’ll know how much you need to pay every month, and you won’t have to worry about sudden market changes.
Student Loans
Student loans are used to pay for higher education. Because the U.S. Department of Education wants more people to pursue higher education, they’ve made student loan interest rates among the lowest available.
Most student loans come with a fixed interest rate, so you’ll know how much you need to pay every month when the repayment starts.
Auto Loans
Auto loans are used for buying a new car, truck, motorcycle, or other motor vehicle. The purchased vehicle serves as collateral, and if you stop making payments the lender can seize the vehicle and sell it to cover the loss. Most auto loans come with fixed interest rates.
Personal Loans
Personal loans are a form of unsecured borrowing, where the borrower takes out a certain amount of money, and then pays the loan back with interest over a set period of time. Most personal loans come with fixed rates, which makes it easier to plan out your budget.