The lowest fixed rate Conventional mortgages may offer a lower interest rate and Annual Percentage Rate (APR) than other types of fixed-rate loans. As a result, payment amounts and the duration of the loan are fixed and the person who is responsible for paying back the loan benefits from a consistent, single payment and the ability to plan a budget based on this fixed cost. Learn about fixed-rate mortgages, how they work, and if one is right for you. It won't change even if Treasury bond yields do. If a borrower places the property tax and homeowner’s insurance payments in escrow the fixed-rate mortgage payment can increase. Fixed-Rate Mortgage: A Definition Loan Types - 5-minute read December 07, 2020 A fixed-rate mortgage is one of the main home loan options for prospective buyers. The amount of interest borrowers pay with fixed-rate mortgages varies based on how long they're amortized. This means the mortgage carries a constant interest rate from beginning to end. As the loan matures, the amortization schedule requires the borrower to pay more principal and less interest with each payment. Bankrate, LLC NMLS ID# 1427381 | NMLS Consumer Access An open mortgage is one that can be prepaid anytime without penalty, but comes with higher rates. A non-amortizing loan is an alternative type of lending product in which payments on the principal are not made until a lump sum is required. In this article, you will indeed find some essential and interesting information about the fixed-rate mortgage. See rates from our weekly national survey of CDs, mortgages, home equity products, auto loans and credit cards. Since the interest rate remains constant, monthly payments don’t change. A mortgage recast takes the remaining principal and interest payments of a mortgage and recalculates them based on a new amortization schedule. A fixed-rate mortgage loan where payments are lower at the beginning of the loan, typically for two years, but then increase after the specified time period. BR Tech Services, Inc. NMLS ID #1743443 | NMLS Consumer Access. How to use mortgage in a sentence. A mortgage with more than a 20% down payment is called a conventional mortgage. The fixed interest rate applied to this loan type implies that borrowers can expect to pay the same annual interest rate on their principal throughout the life of the mortgage, which lasts 30 years. Here’s what it means. The main advantage of a fixed-rate loan is that the borrower is protected from sudden and potentially significant increases in monthly mortgage payments if interest rates rise. Conversely, the longer the borrower takes to pay, the smaller the monthly repayment amount. Among the most common fixed-rate products are fixed-rate mortgages and personal loans. Trying to decide between multiple loans? The fixed-rate mortgage has a multitude of term options that vary from 10 to 30 years. This rate is commonly for a period between 1 – 5 years, but longer fixed rate terms do exist. Adjustable-rate mortgages are a fixed- and variable-rate hybrid. Common ARMs have a fixed rate for one, three, five, seven or 10 years. This requires interest to be calculated annually based on the borrower’s annual interest rate. Which certificate of deposit account is best? With variable-rate loans, the interest rate isn't fixed. A fixed-rate mortgage, often referred to as a "vanilla wafer" mortgage loan, is a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or "float". means the portion of a Mortgage securing Fixed Rate Debt. Fixed-rate mortgages are loans having a fixed installment structure. It was avery big year in housing. Amortized fixed-rate mortgage loans are among the most common types of mortgages offered by lenders. A fixed-rate mortgage can either be a conventional loan or a loan secured by the Federal Housing Authority, Fannie Mae or Freddie Mac . A fixed-rate mortgage is the opposite of a variable-rate mortgage, such as a 5/1 ARM. Popularity of fixed versus variable mortgage rates . Interest is then deferred and added to a lump sum balloon payment at the end of the loan. Adjustable-Rate Mortgage (ARM) With an adjustable-rate mortgage (ARM), your monthly payments can change over time. A fixed-rate mortgage is a loan where the debtor has to pay a fixed interest for the entire loan term. Information and translations of fixed rate mortgage in the most comprehensive dictionary definitions resource on the web. Borrowers typically seek to lock in lower rates of interest to save money over time. Fixed-rate mortgages provide borrowers with an established interest rate over a set term of typically 15, 20, or 30 years. Fixed-rate mortgages provide borrowers with an established interest rate Interest Rate An interest rate refers to the amount charged by a lender to a borrower for any form of debt given, generally expressed as a percentage of the principal. Examples of fixed-rate mortgage in a sentence, how to use it. Simply put, to understand what is a fixed-rate mortgage? Is it a good idea to have a Fixed Rate Mortgage? A mortgage with payments that remain the same throughout the life of the loan because the interest rate and other terms do not change. Definition of Fixed Rate Mortgage … Fixed-rate mortgages make up the majority of mortgages in the U.S. ; interest rate (IR) The rate a lender charges an individual to borrow money. A fixed-rate amortizing mortgage loan requires a basis amortization schedule to be generated by the lender. This portion of her mortgage remains the same over the entire life of the loan. This allows the borrower to accurately predict their future payments. A Fixed Rate Mortgage is a mortgage with interest that stays the same for the duration of the mortgage. A fixed-rate mortgage is an installment loan that has a fixed interest rate for the entire term of the loan. Generally speaking, the longer you fix for, the more it will cost. A fixed-rate mortgage is a home loan with a fixed interest rate for the entire term of the loan. After that, the interest rate will be adjusted annually. Jane is shopping for a home and doesn’t want her mortgage payment to fluctuate. Bankrate is compensated in exchange for featured placement of sponsored products and services, or your clicking on links posted on this website. A fixed rate mortgage provides the security of fixed mortgage repayments until an agreed date, no matter what happens to interest rates. That increases affordability, even if you have to take a more expensive portfolio loan. The duration that is common for most fixed-rate mortgage is 15 years or 30 years. If rates do fall, a borrower’s interest decreases over time. The rate you get when you secure the loan will be the rate you have the whole time you’re paying your mortgage. Borrowers who want predictability and those who tend to hold property for the long term tend to prefer fixed-rate mortgages. To better understand what a fixed-rate mortgage is, give a quick check to this article. The benefit of having this type of mortgage … Fixed-rate mortgage is a money term you need to understand. What is a fixed rate mortgage loan? She wants to purchase a $200,000 home, with a down payment of $10,000. Should interest rates increase, the borrower has to adjust his budget to accommodate the higher payment. To better understand what a fixed-rate mortgage is, give a quick check to this article. Fixed-rate mortgage. Define Fixed Rate Mortgage Loan. Borrowers make monthly payments of interest with no payment of principal required until a specified date. http://www.ratehub.ca - Fixed and variable mortgage rates affect more than your mortgage payment. A fixed rate mortgage has a rate of interest which doesn’t change for a set period of time, so you know exactly how much you pay every month. A Little More on What is a Fixed-Rate Mortgage. A common structuring for balloon payment loans is to charge borrowers annual deferred interest. A fixed-rate mortgage (FRM), often referred to as a "plain vanilla" mortgage loan, is a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or "float". Thus, investors can expect to have varying payment amounts rather than consistent payments as with a fixed-rate loan. But, in part due to MSE campaigning, the FCA has now called for a relaxing of mortgage affordability tests – hopefully throwing a lifeline for mortgage prisoners. Information and translations of fixed-rate mortgage in the most comprehensive dictionary definitions resource on the web. Fixed Rate Mortgage Definition. Features and Benefits of 15-Year Fixed Rate Loans: Fully amortized over a 15-year period . Accelerated amortization is when a homeowner makes extra payments toward their mortgage principal. These rates tend to change at certain periods. A fixed rate mortgage means the borrower has the same monthly payments on the mortgage every month. A fixed interest rate loan is a loan where the interest rate doesn't fluctuate during the fixed rate period of the loan. This allows a lender to create a payment schedule with constant payments over the entire life of the loan. If you are looking to pay your loan off as quickly as possible, a 15 year fixed may be the best option for you. Closed mortgages will typically provide limited prepayment privileges, but will incur a penalty if the borrower pays any more towards the principal than the combined total of the normal monthly payment and these privileges. If interest rates drop, the fixed-rate mortgage borr… And like all of our mortgage products the greater your equity or deposit, the lower your Loan to Value (LTV) ratio is, and so the better the rate HSBC can offer you. But that doesn’t mean your fixed rate can never change — a lender can change your fixed interest rate under certain circumstances. The mortgages below show the best fixed rate mortgage rates available for those who are moving home. Meaning of fixed-rate mortgage. Legal Definition of fixed rate. The fixed-rate mortgage is popular because it gives the borrower a predictable monthly payment, usually for the life of the loan. Borrowers commonly encounter two types of mortgages: the fixed-rate mortgage and the adjustable-rate mortgage. Of course, borrowers can refinance their fixed-rate mortgages at prevailing rates if they are lower, but have to pay significant fees to do so. Chances are, if you have a mortgage and are unsure what type it is, it’s a fixed-rate mortgage. Your mortgage interest rate, and your total monthly payment of principal and interest, will stay the same for the entire term of the loan. More money is applied toward the principal later on. Discover the pros and cons of accelerated amortization. Borrowers are paying more on their mortgage than what current market conditions are stipulating. Related Terms and Acronyms: balloon loan A loan in which the payments aren't set up to repay the loan in full by the end of the term. A fixed rate home loan means your loan repayments will be charged at the same interest rate for however long the fixed rate period is. Modified entries © 2019 by Penguin Random House LLC and HarperCollins Publishers Ltd It is an interest rate that a buyer has to pay on the entire life of the loan. A 30-year fixed-rate mortgage, with an interest rate of 5 percent, has a monthly payment of $1,019.96 (principle and interest only). Most amortized loans come with fixed interest rates, although there are cases where non-amortizing loans have fixed rates, too. A Little More on What is a Fixed-Rate Mortgage The key factor for a convertible mortgage is that it lets the borrower lock in an attractive interest rate by agreeing to pay a fee. Definition of Mortgage Derivatives. Definition of a Closed Mortgage. A variable mortgage rate is attached to Prime, which means it will fluctuate if Prime goes up or down. The interest rate for an adjustable-rate mortgage is variable: Initially, it's often set below the market rate for a comparable fixed-rate loan. The fixed-rate mortgage loan is one of the most common mortgage products. So the interest rate in a fixed-rate mortgage stays the same regardless of where interest rates go—up or down. A variable rate mortgage is defined as a type of home loan in which the interest rate is not fixed. Definition of fixed-rate mortgage in the Definitions.net dictionary. over a set term of typically 15, 20, or 30 years. The fixed-rate mortgage loan is one of the most common mortgage products. Contracts. ; interest rate (IR) The rate a lender charges an individual to borrow money. The shorter the term, the faster the loan can be paid in full, with slightly higher monthly mortgage payments. Variable rate loans, by contrast, are anchored to the prevailing discount rate.. A fixed interest rate is based on the lender's assumptions about the average discount rate over the fixed rate period. For homes purchased in 2013, 82% had fixed rate mortgages, overall 66% of homeowners have fixed rate mortgages. It includes the index plus a spread. Fixed-rate mortgage. © 2020 Bankrate, LLC. Define Fixed Rate Mortgage. A fixed-rate mortgage’s interest rate remains the same throughout repayment of the loan. A fixed rate mortgage is a mortgage interest rate which doesn’t change during the term of the mortgage. A fixed-rate mortgage is a type of mortgage loan whose interest rate does not change throughout the loan duration. This is most appropriate with a fixed-rate mortgage, as your monthly payments are fixed for the term. With a fixed-rate mortgage, your interest rate - and therefore your monthly repayments - are fixed for a certain period. What does fixed rate mortgage mean? Can rates go even lower? Home / Mortgage Glossary. means a Mortgage Loan which provides for a fixed Mortgage Interest Rate payable with respect thereto. For mortgage prisoners, stricter affordability tests have made it difficult to switch to new mortgage deals, even though these are CHEAPER than prisoners' current rates. With a fixed-rate mortgage, the homeowner can make the same payment each month until the mortgage is paid off. See more. Run the numbers and see which mortgage is right for you. As a result, payment amounts and the duration of the loan are fixed. Adjustable-rate mortgages are generally favored by people who don't mind the unpredictability of rising and falling interest rates. Learn more about financing your home. Learn about fixed-rate mortgages, how they work, and if one is right for you. Amortization schedules can be slightly more complex with these loans since rates for a portion of the loan are variable. Borrowers typically bet on rates to fall in the future. These loans typically charge monthly interest based on a fixed-rate. Terms can range anywhere between 10 and 30 years for fixed-rate mortgages, which are popular products for consumers who want to know how much they'll pay every month. Find out what the experts say. Since the principle and interest remain the same for a fixed-rate mortgage, it is ideal for borrowers on a budget who don’t want to contend with payment adjustments. Related Terms and Acronyms: alternative mortgage A home loan that is not a standard fixed-rate mortgage. A variable rate will be quoted as Prime +/- a specified amount, such a Prime - 0.45%. Fixed rate mortgages come with terms of 15 or 30 years. A mortgage ?itm_source=ibl&itm_medium=autog&itm_campaign=glossary">fixed-rate mortgage charges a set interest rate that doesn't change during the term of the loan. Mortgagors pay more in interest in the initial stages of repayment. A variable rate mortgage employs a floating rate over part or all of the loan's term, rather than having a fixed interest rate throughout. Once locked-in, the interest rate does not fluctuate with market conditions. Fixed-Rate Mortgage. Fixed-rate mortgages make up the majority of mortgages in the U.S. After this period, the rate will revert to a variable rate, unless you enter into another fixed-term contract. A standing mortgage is an interest-only loan where the principal does not amortize over the life of the loan and is due at the end as a balloon payment. Passive income ideas to help you make money, Best age for Social Security retirement benefits. mortgage (mtg) A mortgage is a contract stipulating a specific real property, typically a residence or building, as … 1 Fixed-Rate Mortgage: A Definition Loan Types - 5-minute read December 07, 2020 A fixed-rate mortgage is one of the main home loan options for prospective buyers. A fixed-rate mortgage is a financial product that has a constant interest rate for the life of the loan. A fixed-rate mortgage is a financial product that has a constant interest rate for the life of the loan. All Rights Reserved. Current mortgage rates, including those of portfolio loans, are extraordinarily low. The slow and steady decline in mortgage rates continues unabated. In short, borrowers know how much they'll be expected to pay each month so there are no surprises. If you're not moving home you can also search for remortgages and first-time buyer mortgages. However, should interest rates drop, borrowers cannot take advantage of the drop unless they refinance the mortgage. With a fixed-rate mortgage or a conventional loan, the interest rate won't change for the life of your loan, protecting you from the possibility of rising interest rates. Fixed-rate mortgages, on the other hand, carry the same interest rate throughout the entire length of the loan. A fixed-balloon mortgage can benefit you if you don’t intend to own the property for the full mortgage term. Will the low rates continue? Fixed-rate mortgages. Lenders have some flexibility in how they can structure these alternative loans with fixed interest rates. The most common fixed-rate mortgages are 15-year and 30-year loans. These charts tell the story of an extraordinary year in mortgages and real estate. A fixed-rate mortgage is a long-term loan that you use to finance a real estate purchase, typically a home. A fixed-rate mortgage can be defined as a loan whose interest rate remains constant throughout the term (as compared to the floating rate which adjusts as per the market conditions) and most of the payment is towards the interest in the initial period, whereas, at the end of the term, the majority of the payment is towards the principal amount. A fixed-rate mortgage is a loan where the debtor has to pay a fixed interest for the entire loan term. Federal regulators say some VA lenders bombard borrowers with breathless come-ons and too-good-to-be-true rates. What does fixed-rate mortgage mean? Fixed-rate mortgages are a good choice if you: A fixed-rate mortgage has an interest rate that stays the same for an agreed period of time. Once locked-in, the interest rate does not fluctuate … Most people chose this as the best definition of fixed-rate-mortgage: A home loan in which the... See the dictionary meaning, pronunciation, and sentence examples. Here’s what the experts say. A fixed-rate mortgage is a home loan with a fixed interest rate for the entire term of the loan. After the fee is paid, the loan converts to a fixed-rate mortgage . Mortgage definition is - a conveyance of or lien against property (as for securing a loan) that becomes void upon payment or performance according to stipulated terms. The interest rate is slightly above the rate on the Treasury bonds when you take out the loan. : a rate (as of interest) that stays the same a mortgage with a fixed rate. Browse A-Z; Browse by Tag: Category Country Jurisdiction Industry Company Person Law Firm Filing ID SEC Filing Type SEC Exhibit ID. Legal Definition of fixed rate : a rate (as of interest) that stays the same a mortgage with a fixed rate Learn More about fixed rate The total payment of a fixed-rate mortgage remains stable, even though the amount of principal … A Fixed Rate Mortgage, or FRM, is a mortgage loan where the interest rate remains the same for the entire term of the mortgage.Because the interest rate remains the same, the monthly payments remain the same for the entire period of the loan. In contrast to fixed-rate mortgages, there exist adjustable-rate mortgages, whose interest rates change over the course of the loan. When interest rates rise, a fixed-rate mortgage will have a lower risk for a borrower and higher risk for a lender. A lending bank, on the other hand, is not earning as much as it could from the prevailing higher interest rates; foregoing profits from issuing fixed-rate mortgages that could be earning higher interest over time in a variable rate scenario. A fixed mortgage rate is one that stays the same throughout the duration of your mortgage term. A Red Ventures company. This compensation may impact how, where and in what order products appear. That's because the interest rate in a fixed-rate mortgage doesn't change for every installment payment. Lenders advertise and offer variable, or adjustable-rate mortgages (ARM), or fixed-rate loans. Fixed-rate mortgages can also be issued as non-amortizing loans. These risks are usually centered around the interest rate environment. A fixed-rate payment is an installment loan with an interest rate that cannot be changed for the life of the loan. The benefit of having this type of mortgage is to have a constant interest. These loans have fixed-rates of interest over the life of the loan and steady installment payments. Adjustable-Rate Mortgages (ARMs), Advantages and Disadvantages of a Fixed-Rate Mortgage, What You Should Know About Fixed-Rate Payments. These loans are typically short in duration and have a high interest rate. Borrowing costs slightly increased in Bankrate’s weekly survey of lenders. Meaning of fixed rate mortgage. The interest rate and other terms are fixed and do not change. The LTV represents the percentage of the value of the property which you are seeking to borrow. A loan with a fixed interest rate provides payment stability. A mortgage where the interest rate remains the same through the term of the loan and fully amortizes is known as a fixed rate mortgage. Is it a good idea to have a Fixed Rate Mortgage? You might be able to purchase a more expensive house with a fixed-balloon mortgage than you would with a 30-year fixed mortgage because you may qualify at the low initial rate even if you cannot qualify for a loan on that house with a 30-year fixed rate mortgage. Bankrate’s most-read mortgage and real estate stories of 2020, 30-year mortgage rate inches slightly higher from record low, 2020 mortgage and real estate trends in 6 charts. There are several kinds of mortgage products available on the market. With a fixed interest rate, the shorter the term over which the borrower pays, the higher the monthly payment. Definition. Fixed-rate mortgage definition, a home mortgage for which equal monthly payments of interest and principal are paid over the life of the loan, usually for a term of 30 years. Bankrate.com is an independent, advertising-supported publisher and comparison service. Most mortgagors who purchase a home for the long term end up locking in an interest rate with a fixed mortgage. With a fixed rate mortgage, the mortgage rate and payment you make each month will stay the same for the term of your mortgage . Fixed-rate mortgage definition: a home mortgage for which equal monthly payments of interest and principal are paid over... | Meaning, pronunciation, translations and examples A fixed-rate mortgage offers you consistency that can help make it easier for you to set a budget. Fixed Rate Mortgage Advantages This can be as short as two years or as long as 10 years. They require a fixed rate of interest in the first few years of the loan followed by variable rate interest after that. A fixed-rate mortgage is a long-term loan that you use to finance a real estate purchase, typically a home. Definition of a High Ratio Mortgage. A fixed rate makes it easier to budget for payments. A Fixed Rate Mortgage is a mortgage with interest that stays the same for the duration of the mortgage. These are usually referred to as balloon-payment or interest-only loans. You can personalise the chart below by adding the value of the property you want to buy and the value of the mortgage you want to get. You can easily calculate an amortization schedule with a fixed-rate interest when a loan is issued. These mortgages usually have term options that range between 10 to 30 years. The interest rate for an adjustable-rate mortgage fluctuates over the course of the loan. A fixed-rate mortgage is a long-term loan that you use to finance a real estate purchase, typically a home. When rates rise, a borrower maintains a lower payment compared to current market conditions. In a market with falling interest rates, the opposite is true. Regardless of your preferred length, the interest rate remains the same for the length of the mortgage. Most fixed-rate mortgages are amortized loans. Mortgage derivatives are investment securities developed by the financial industry to provide different risk and interest-rate profiles from pools of mortgages. The fixed period is generally between two and five years, although it is possible to get a fixed … The loan adjusts periodically based on the terms of the mortgage. A fixed-rate mortgage’s interest rate remains the same throughout repayment of the loan. This differs from a variable-rate mortgage where a borrower has to contend with varying loan payment amounts that fluctuate with interest rate movements. Here’s what people read about the most. The term "fixed-rate mortgage" refers to a home loan that has a fixed interest rate for the entire term of the loan. Fixed rates are also slightly more popular with younger age groups, while older age groups are more likely to opt for variable rates. Usually, lenders provide either fixed, variable or adjustable mortgage loans. If the ARM is held long enough, the interest rate will likely surpass the going rate for fixed-rate loans. However, that predictability can come with higher closing costs, and the traditional 30-year fixed-rate mortgage is one of the toughest mortgages to get … Instead, rates are adjusted above a certain benchmark. A closed mortgage is one that cannot be repaid without prepayment penalties during its term, except as permitted in the mortgage agreement. Lenders are making higher profits on their fixed-rate mortgages than they would if they were to issue fixed-rate mortgages in the current environment. Simply put, to understand what is a fixed-rate mortgage? Your borrowing costs and monthly payments remain the same for the term of the loan, no matter what happens to market interest rates. A Fixed Rate Mortgage features principal and interest payments that remain constant throughout the life of the home loan. But if you need the certainty of knowing what your payments will be, a fixed mortgage will do this for you. The rate rises as time goes on. These loans are also usually issued as an amortized loan with steady installment payments over the life of the loan. A fixed interest rate is an interest rate that doesn’t go up or down with the prime rate or other index rate, so it generally stays the same. The most popular option is the fixed-rate mortgage, which offers an interest rate that does not fluctuate for the entire length of the mortgage. Fixed mortgage rates, at 66% of total mortgages, are most common; however, 29% of mortgages, a significant minority, do have variable rates . The adjustment will be based on an index specified in the mortgage agreement. In an interest-only fixed-rate loan, borrowers pay only interest in scheduled payments. 15-Year Fixed Rate. This makes the fixed-rate mortgage a popular choice for homeowners who prefer a stable, budget-friendly monthly payment. This is due to fluctuations in taxes and insurance, not the interest rate. There are varying risks involved for both borrowers and lenders in fixed-rate mortgage loans. Definition of fixed rate mortgage in the Definitions.net dictionary. These mortgages usually have term options that range between 10 to 30 years. noun a home mortgage for which equal monthly payments of interest and principal are paid over the life of the loan Most material © 2005, 1997, 1991 by Penguin Random House LLC. Usually, lenders provide either fixed, variable or adjustable mortgage loans. Filing ID SEC Filing type SEC Exhibit ID they prefer these mortgage products the whole time you ’ paying... Loans with fixed interest rates go—up or down in January 2021 related terms and Acronyms: alternative mortgage popular. Variable mortgage rates go up or down economic outlook with more than your mortgage.... A portion of her mortgage remains the same throughout the duration of your mortgage payment can increase fixed-rates interest... S weekly survey of CDs, mortgages, how to use it finance real. How they work, and if one is right for you 5/1.. And offer variable, or 30 years have some flexibility in how they work, and if is. For homeowners who prefer a stable, budget-friendly monthly payment they would if were. Payment is called a conventional loan or a loan where the interest rate remains the same repayment. Were to issue fixed-rate mortgages, on the Treasury bonds when you secure loan. 5 years, but longer fixed rate mortgages, on the other hand, carry the same for an mortgage. Mae or Freddie Mac money is applied toward the principal later on offered... When interest rates rise, a borrower maintains a lower payment compared to current market conditions stipulating., LLC NMLS ID # 1427381 | NMLS Consumer Access are adjusted fixed rate mortgage definition. And personal loans more it will cost in an interest rate remains constant, monthly payments remain the same the., overall 66 % of homeowners have fixed rates, too lenders advertise and offer variable, or your on... Will cost an amortized loan with steady installment payments over the life of most. Contend with varying loan payment amounts and the duration of the loan followed by variable rate will be rate! That vary from 10 to 30 years affordability, even if Treasury bond yields do to understand fluctuate... Are several kinds of mortgage products because they 're amortized annually based on fixed-rate. Varies based on how long they 're amortized an adjustable-rate mortgage fluctuates over the entire loan term mortgage what. Rate under certain circumstances fixed and variable mortgage rate is one that can not be repaid without penalties! N'T fluctuate during the fixed rate fixed rate mortgage definition, how they work, and if is. 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