What Happens When Your Fixed-Rate Mortgage Period Ends?
When the fixed-rate mortgage period ends, homeowners may experience a shift in their mortgage payments. A fixed-rate mortgage offers a set interest rate for a predetermined period, often 15 or 30 years. Once this period expires, the loan typically transitions to a variable or adjustable-rate mortgage (ARM). This means your interest rate can fluctuate based on the market, and this change can significantly affect your monthly payments. For many homeowners, this change can lead to higher payments, especially if interest rates rise.
What Are Your Options After the Fixed-Rate Mortgage Ends?
After the fixed-rate period concludes, borrowers have a few options to consider. Some may choose to refinance their mortgage to lock in a new fixed rate, which could offer more predictable payments in the future. Others may opt to stay with the new adjustable rate, assuming they believe interest rates will remain stable or decrease. It’s also possible to pay off the mortgage entirely if financially feasible. Homeowners must carefully evaluate their financial situation, future market conditions, and long-term goals before making a decision to ensure they are choosing the most beneficial option for their circumstances. What happens fixed rate mortgage ends