Question:

Is there a 5 year fixed rate mortgage?

Answer:

Yes, there is. The 5 year fixed rate mortgage is common in the UK where the rate will stay low for a period of 5 years and will then adjust. It is advertised as a fixed rate mortgage but it is in fact an ARM with a single rate adjustment to the Standard Variable Mortgage Rate in 5 years.

A 5 year fixed rate mortgage can also be obtained in Canada. In comparison to the UK and Canada, a 5 year fixed rate mortgage is not offered in the US under the same name. However, a hybrid 5/1 ARM is the closest to the British 5 year fixed rate mortgage. For both, the rate stays fixed for the first 5 years and then adjusts. However, the 5 year fixed rate mortgage in the UK will adjust only once.

The Canadian 5 year fixed rate mortgage usually allows prepayment during the first 5 years. The UK version can be more restrictive.

Recommended helpful present and future homeowners links:
Why: Refinance to a fixed rate loan while mortgage rates are still low.
Link:
Why: Because FHA loans are insured by the US Federal Government they have very competitive interest rates and are easier to qualify.
Link:
Why: Know and protect your credit report and score.
Link: See All 3 National Credit Scores & 3 Reports Instantly, Online & Free
Link this QnA Print del.icio.us Digg
Was this Mortgage QnA helpful?
Not at all
  • Currently 3/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
 Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA:

Common misspellings: mortage and morgage