Fixed rate loans have the same principal and interest payments during the loan term. Variable rate loans can have any one of a number of indexes and margins which determine how and when the rate and payment amount change. Most loans can be repaid over a term of 30 years or less. Most loans have equal monthly payments. The amounts can change from time to time on an ARM depending on changes in the interest rate.
Some loans have short terms and a large final payment called a balloon.
You should shop for the type of home mortgage loan terms that best suit your needs. Often the price of a home mortgage loan is stated in terms of an interest rate, points, and other fees. A point is a fee that equals 1 percent of the loan amount. Points are usually paid to the lender, mortgage broker, or both, at the settlement or upon the completion of the escrow. Often, you can pay fewer points in exchange for a higher interest rate or more points for a lower rate.