Why 10-year terms are becoming more popular than the 5-year term is no mystery. With rates so low a 10-year term has obvious benefits and before you decide on the term & rate you take it is important to talk to your mortgage professional to ensure it is your most favorable option for your present financing situation. However, if you’ve been wondering about the advantages of a 10-year term, a few of them are listed below;
A lot can happen in 10 years…… You could change jobs a couple of times or you could have a baby or two! Ten years seems like a long time, however, with mortgage rates at an all-time low, knowing your interest rate or payments aren’t going to change anytime soon can help relieve some of the worry that comes along with the uncertainty of our economic future.
If you are considering entering into a 10-year term, some lenders allow you to break your term after 5 years with only a 3 month interest penalty. Given that most 10-year terms are also portable and can be assumed with qualifications, you could take this great rate to your new home should you decide to move or leave it with the home which may add to the attractiveness of your home versus others selling in your same area.
The assurance of a 10-year term can definitely be appealing, however it is still imperative you are aware of all the options available to you so you can make an educated decision about your financial future. Be sure to talk to your mortgage professional about the pros and cons of any potential mortgage term you may take. As usual, The MortgageGirls are here to answer any questions you may have.