Types of loans in USA, interest rates on them. Is it difficult to arrange a usda home mortgage
in America and what savings will bring a refinance loan?
Hello! You Shashank, the author of the blog All about US. Today I will do a video on the subject of loans in America and divide it into two parts. First I will tell you about interest rates, about the main types of loans that are there. While the second part will share their opinions about loans in the U.S. and in particular about mortgage, credit to purchase real estate. So if anyone is interested, the next video I put up, probably in a few days. Well, in this movie, as I said, we will focus on interest rates. There are four main types of loans in the United States: a home loan (mortgage or usda home mortgage
, as he is here called); loan car; loan for study; personal loan on your personal needs.
As you probably already know, interest rates on loans was at a record low in recent years, such in the US, probably 20 years. But now they are growing slowly. And, as for a home loan, there are rates fixed, that is fixed, there are adjustable – floating. Maybe I’m not accurately translate the terms into Russian, but the meaning is, I think, is clear. Fixed rate happens most often when you loans for 30 or 15 years. For 30 years the rate is now 4.125%, a couple of years ago it was $ 3 something, it was the lowest percentage in history. Fixed rate at the conclusion of the credit agreement for 15 years now is 3.375% floating from 3.125 to 3.25%. Will explain a little bit what the difference is between the types of interest rates. So fixed rate. You sign a contract, take a loan for 30 or 15 years, you pay a fixed usda home mortgage
that is more than under no circumstances, you will not pay. A floating rate. When you sign a contract, it is prescribed that during, for example, 10, 5, or 7 years you will pay a certain percentage, then the Bank has the right interest rate to raise. How much it can rise each year specified in the contract. In fact, such loans are best for those who plan to pay all the for the fixed term, either going to sell the house before the end of this period. Often such a loan is we take people who, for example, from another state. They want to buy a house, work a few years, then sell it and usda home mortgage
to another place. In this case, cheaper floating rate, rather than fixed, because it is lower. If you are still going to sell the house through 3-5-7 years, it does not matter. But if you’re going to live in it and not be able to repay the loan within a certain period, then the loan rate is too high, it will not be profitable. If we consider periods of 15, 20, 30 years, the loan with a floating rate is much less profitable than fixed.