To help answer any questions you might have, we’ve put together the latest information on coronavirus and income protection. If you own a home and rent it out, you need a specific type of homeowners insurance, called “dwelling fire” or landlord insurance. Contact a licensed agent to get a quote for this kind of policy. Smoke detector alarms and fire extinguishers save lives and could save you money on your homeowners insurance.
Our insurance industry partnerships don’t influence our content. To compare quotes from many different insurance companies please enter your ZIP code on this page to use the free quote tool. Upon the accidental death of the primary insured, pays an additional 10% of the death benefit for each dependent child who, on the date of the accident, is between the ages of 15 and 22.
Using the above example, you would be paying mortgage payments based on a total home loan amount of $556,740 rather than the initial $540,000 as would be the case had you put down at least 20%. RRSPs (if you’re a first-time homebuyer) in order to beef up your down payment and take advantage of a lower mortgage default insurance rate. Service-Disabled Veterans Life Insurance (S-DVI) provides low-cost coverage to eligible service members.
In the event of loss, the actual terms and conditions set forth in your policy will determine your coverage. This coverage helps protect structures that are not directly attached to your home. For example, if your detached garage is damaged, other structures coverage can help with the repair costs.
For far too long people have been searching for the best mortgage life insurance companies and whether to sign up for suitable plans. Make sure the company you choose guides you on exactly what a mortgage life insurance is and how it works, and if it suits you, then only you sign up for it. From this tool, you can find all sorts of mortgage protection life insurance quotes and find an estimate of which option to go for. Of course money is very important in such a situation and getting a quote will only make it easier for you to decide, before banks can take advantage of you. Mortgage life insurance pales in comparison to term life in many cases, but if mortgage life insurance would give you the peace of mind, make sure you do your homework so you choose the best plan for you.
Oklahoma has the highest average home insurance rates of $4,445, based on an Insurance.com rate analysis. Below you’ll see the top five states that are most expensive for homeowners insurance, with a more detailed explanation below. In most cases, Senior life insurance rates by agequotes provider must complete the review and send it to when is mortgage insurance required him, and he in turn sends the transaction in thirds to the contractor . You will most likely need to return private mortgage insurance overnight. There are a few things you can do to reduce the amount you pay for mortgage protection insurance. The amount depends on your level of cover and you can choose a lump sum or regular payments.
Mortgage insurance is a scam to siphon more money away from people.
VA loans have far lower requirements, and no PMI.
Zero down, no/bad credit, better interest rates, no PMI.
Only reason I have multiple homes is because I was able to get a VA loan. Otherwise none.
— Misty 🌹🏳️⚧ (@MistyOnTap) October 4, 2021
That number goes up to $3,000 if you get five additional quotes. Many online lenders can give you free rate quotes to help you decide whether the money you’d save in interest charges justifies the cost of a new loan. Try to get a quote with a soft credit check which won’t hurt your credit score. In most cases, an adjuster will inspect the damage to your home and offer you a certain sum of money for repairs, based on the terms of your policy. The insurance company will then typically send an advance, before sending the final payment. In fact, you may get multiple checks as you make temporary payments, permanent repairs, and replace damaged belongings.
Tax amounts may change due to the tax rate established by your taxing authority, as well as the taxable value of your property. You could also enroll in autopay without having to worry to adjust the mortgage payment amount. It takes one full statement period for the change to take effect and fees may apply for paper statements. You can easily set up paperless preferences for your mortgage account from online banking or the U.S.
For example, imagine you’re looking at a $200,000 mortgage refinance with closing costs of 3%, or $6,000. If refinancing lowers your mortgage payments by $150 a month, it will take you 40 months to break even, and you’ll start reaping savings only then. If you don’t plan to stay in your home for more than 40 months, refinancing doesn’t make sense. Some of our favorite mortgage lenders for refinancing have below-average fees, but refinancing is still likely to cost you something. For more on how to determine if refinancing is worth it, check out our expert advice.
Do You Need Mortgage Protection Life Insurance In 2021?
This policy sounds good in theory but in reality there is a much better and cheaper alternative that is making traditional mortgage life insurance obsolete. Something else to consider before taking out mortgage protection insurance is whether you may already have cover for your mortgage repayments in another policy. This could be found in life insurance or income protection insurance as part of your super, so it might be a good idea to review these policies before signing up. Your family will have a mortgage-free home if you die or cannot work due to illness or injury. If your mortgage payment makes up a substantial part of your budget each month, it’s smart to consider how your family might cover the cost if you were to die or become incapacitated. With a mortgage insurance policy in place, you won’t have to worry or wonder what might happen.
In many cases, couples will purchase mortgage life insurance on both the husband and the wife. When you start weighing the pros and cons and then look at the other insurance options, you may feel that life insurance to pay off a mortgage isn’t the best idea for you. There are likewise some mortgage protection insurance that pays out depending on the size of your compensation. For instance, you could get contract insurance cover for half of your compensation. For years, Ottawa has tried to reduce taxpayer exposure to risky borrowers.
Please refer to the relevant Product Disclosure Statement and the Target Market Determination on the provider’s website for further information before making any decisions about an insurance product. 3 year fixed rates are for new Owner Occupier Principal & Interest loans. Lenders Mortgage Insurance is one-off payment that borrowers who don’t have a deposit of 20% or more pay to protect the lender if they were to default on their loan. Mortgage lenders often publish online their rates for different mortgage types, which can help you research and narrow down which lenders you apply to for preapproval.
Keep in mind that credit scoring services like FICO adjust your credit based on mortgage inquiries; Lotz has a good piece of advice for those who are shopping around for the best rate at different lenders. “Credit is the biggest factor in interest rates on both mortgages and all other lending products, so making sure credit balances are below 30% is key to maximizing a credit score,” says Lotz. “If a person finds errors on their credit report, they should dispute them to ensure the most accurate history.” Mortgage life insurance is expensive for the coverage amount purchased. The biggest advantage of this protection is knowing your mortgage loan will be fully repaid no matter what happens with your health. Before we go any further, let’s discuss both the advantages and disadvantages which come with buying mortgage protection coverage.
A conventional home loan is one that is generated and insured within the private sector, with no government backing or insurance. Lenders typically require PMI whenever a borrower puts down less than 20% on a home loan. In other words, this insurance is usually required when the loan-to-value ratio exceeds 80%. Whether you need term or a universal life policy, our well seasoned agents will walk you through your options. … this was the second “old-fashioned type of mortgage life insurance” we discussed above.
Pros & Cons Of A Mortgage Life Policy
Consider all the advantages and disadvantages of conventional and FHA loans when you are making your decision. A blending of participating and term life insurance, wherein a part of the dividends is used to purchase additional term insurance. This can generally yield a higher death benefit, at a cost to long term cash value. In some policy years the dividends may be below projections, causing the death benefit in those years to decrease.
This policy does not decline, so the value of the purchase remains constant. So it is indeed a better choice than the old-fashioned mortgage protection insurance described above. This is not a bad solution, because it will provide enough coverage to pay off the mortgage should the insured die before it’s paid off. The excess death benefit can be used by the beneficiary for other needs and expenses at their discretion. MOST agents will sell you this type of life insurance for mortgage protection. A whole life policy is said to “mature” at death or the maturity age of 100, whichever comes first.
CMHC insurance premiums can add thousands of dollars to the cost of your mortgage. The cost of this mortgage default insurance will either need to be paid upfront or it will be added to your mortgage principal balance. Adding the cost of the mortgage insurance to your principal means that you will be paying interest on the insurance over time, adding on to the cost of your mortgage.
What Is Private Mortgage Insurance Pmi? Does This Make Sense For You?
Let’s now take a look at some of the other options you may be exposed to if you go to another agency to protect your mortgage through life insurance. For example, if you have a 30 year mortgage, most agents will try to automatically sell you a30 year term policy, whose death benefit stays levelduring the entire 30 years. Globe Life is the marketing name for Globe Life Inc. and its subsidiaries. Product availability and features vary by state and subsidiary.
Attention try added onto the total amount you owe each and every month which means the sum you pay arise as being the focus on loan adds up by and by and desire is not up until the mortgage try reduced. Car insurance in Ontario has become more affordable during the pandemic. Insurance companies are reporting better profits than they’ve seen in years, and many have passed the savings on to policyholders in the form of lower premiums and rebates. Analysts predict that prices will continue to decline if enough customers continue to work from home.
Also, keep in mind that mistakes often happen, and the servicer might not remember to cancel PMI once your loan balance gets to 78% without you reminding them. Ladder Life is one of the new Palo Alto startups disrupting the industry by allowing customers to change coverage amounts for free. The term product they sell is from Fidelity Security Life, which has been in business since 1969. In most cases, the bank is both the policyholder, as well as the beneficiary.
For example, while mortgage rates don’t mirror the Fed funds rate, they do tend to follow it. The Federal Reserve System — or “The Fed,” as it’s commonly called — is the United States’ central bank. It’s tasked with taking steps to keep the economy safe, stable and flexible.
If you have a substantial amount saved up, you might be able to cover your mortgage payments for a while. The less likely you are to claim, the lower your mortgage protection insurance will be. Depending on the mortgage premium insurance at the time, this may be cheaper than BPMI, but keep in mind that it’s impossible to “cancel” LPMI because your payments are made as a lump sum upfront. If you wanted to lower your mortgage payments, you’d have to refinance to a lower interest rate, instead of removing mortgage insurance. Your loan type can influence how much you’ll have to pay in PMI. For example, fixed-rate loans can reduce the amount of risk involved with the loan because the rate won’t change, leading to consistent mortgage payments.
You don’t need to be an insurance expert when you set out to buy your first home, but it can be a challenge when you come across the terms “homeowners insurance” and “mortgage insurance” for the first time. As you learn about your insurance needs at this important new milestone in your life, it may help to know that there is a difference between homeowners insurance and mortgage insurance. Depending on many factors, not every home owner needs mortgage insurance, but to ensure their new home is sufficiently protected, homeowners insurance is usually a necessity. For example, FHA loans are available with as little as 3.5% down.
There are huge differences in your Lenders Mortgage Insurance premium depending on your Loan-to-Value Ratio and the lender you choose. No, we offer loans for second homes and investment properties. Emma’s work has been featured in Huffington Post, NPR and XOJane. When she’s not combing her neighborhood for open houses, she’s writing about technology, real estate or data. Work with your insurance agent to use a replacement-cost estimator that determines only what it costs to rebuild your home with materials of similar quality. In areas where pools are the norm, it could add between $50 and $75 to your annual premium.
Benefit is prorated based on borrowers’ incomes at the time of the mortgage application. Getting your PMI canceled early may only involve costs of a few hundred dollars . When the extra cost is built into your loan payment, you’re stuck with it eliminate mortgage insurance as long as you keep the loan. You can do this either by paying the loan off out of your savings , refinancing the loan, or selling the home and paying off the debt. The lump-sum approach is less common than an adjustment to your mortgage rate.
The values you are providing are constantly changing, and this affects your premium rate. If you apply for VMLI, we will ask you to provide documentation of your mortgage so that we can calculate your premium exactly. Yes – and because you don’t have the same rights in terms of sick pay as PAYE employees, it may be more important that you have the right cover in place. Income protection would help you keep up with your mortgage, monthly bills and other outgoings. See how much smoking can cost you in terms of life insurance.
If your policy’s death benefit is not paid within the initial 20- or 30-year term, you’ll get your money back at the end of the term. 3 You also can keep your policy in place after the initial term 2 or borrow against the cash value 4 of the policy. If rising premium payments is one of your biggest concerns, the Great Eastern Mortgage Care plan puts those worries promptly to rest. Your annual premium amount is fixed throughout the duration of the limited payment term. Limited payment term means that while the policy term is set at 10 years, the plan can be fully paid off within 8 years.
In some instances, you can not only cancel the insurance but you may also get a refund. If you choose to change lenders when it’s time to renew your insured mortgage, you do not have to pay for CMHC insurance again. CMHC insurance covers your mortgage until it is paid off, and will follow you from lender to lender. Simply provide your CMHC certificate of insurance or certificate number.
In their rush to get a quick quote, homeowners miss out on discounts or sign up for a policy that fails to offer the coverage they need, Royster says. Give insurance companies as much information as possible to get the best policy. Royster recommends homeowners search for reviews on each company they’re interested in. The National Association of Insurance Commissioners, JD Power & Associates, and your state department of insurance all provide reviews and public complaints of each provider.
The more you contribute to the purchase price of your property, the lower the cost will be. LMI protects the bank against any loss we may incur if you are unable to repay your loan. In the descriptions below “original value” is defined as the lesser of the sales price or the appraised value at the time of loan consummation. You need homeowners property and liability insurance even after your mortgage is paid off if you want protection for your home. Homeowners property coverage can help protect against the potentially devastating costs to rebuild or replace your property after damaging events like fire, lightening and windstorms.
Conforming loans have maximum loan amounts that are set by the government and conform to other rules set by Fannie Mae or Freddie Mac, the companies that provide backing for conforming loans. A non-conforming loan is less standardized with eligibility and pricing varying widely by lender. Non-conforming loans are not limited to the size limit of conforming loans, like a jumbo loan, or the guidelines like government-backed loans, although lenders will have their own criteria.
Its so bad . like everywhere . average house prices just hit 800k here its ridiculous . I was lucky to buy this year with the help of my parents after sniping my rental for 360 . I got lucky . I feel for those who are not so . I was so close to being homeless .
— Snikerdoodle fox (@foxyfurrytrash) October 2, 2021
Enter your details below to estimate your monthly mortgage payment with taxes, fees and insurance. Regardless if your loan has PMI or FHA insurance, it can be a good idea to buy an MPI policy if you cannot afford a traditional life insurance policy and want to ensure your home goes to your heirs. Many MPI companies also have strict limits on when you can buy a policy.
Through April 30, they made home mortgage interest payments of $1,220. The settlement sheet for the sale of the home showed $50 interest for the 6-day period in May up to, but not including, the date of sale. You may want to treat a debt as not secured by your home if the interest on that debt is fully deductible whether or not it qualifies as home mortgage interest.
It’s also a good idea to compare rates from different lenders to find the best rate for your financial goals. This Notice does not apply to loans insured under the Risk Sharing programs of section 542 or 542 of the Housing and Community Development Act of 1992. Generally speaking, mortgage default insurance is financed through and added to your mortgage. You don’t have to come up with a huge lump sum payment to pay this fee off like you would with other common closing costs associated with a home purchase, such as land transfer taxes. Mortgage default insurance is repaid over the life of the mortgage. CMHC is the biggest mortgage insurance provider and is actually a crown corporation, even though it is operated as a private company.
Consequently, the Fed controls the U.S. money supply and short-term interest rates and sets the Fed funds rate, which is the rate that banks apply when borrowing from each other overnight. There are several private insurance companies that specialize in MPI policies. The specific companies you’ll have access to can vary depending on your state. Now, some insurers are using the internet and technology, to be more competitive, and offering life insurance online with no medical exams.
The establishment fee is waived if you borrow $150,000 or more. Borrow up to 95% LVR of the value of the property you’re buying and pay no ongoing fees. Mortgage brokers can help you apply with lenders that can help match you with the right lenders mortgage insurer for your situation. Instead, you can claim these costs over five years or the full term of the loan . You cannot claim your LMI premiums and other borrowing costs as one lump-sum tax deduction in the year they are incurred (unless the total value is under $100).
Expect loan estimates from each lender within three business days of submitting your mortgage application. CD) will be given to you at least three business days before your closing date. It will reflect the final costs of the transaction, including how much money you need to bring to the closing table. Once you’ve found the perfect place, submit your best offer along with a copy of your preapproval letter. If your offer is accepted, you’ll also pay the required earnest money deposit to show your commitment to the transaction.
Yes, as a property investor, the majority of your borrowing expenses are tax deductible, and this includes your LMI premiums. You will need to decide whether the money gained by refinancing makes the cost of LMI worth it. A mortgage broker may be able to help you run some calculations and work out the best path forward. If you’re buying a home in a capital city, you may need a six-figure deposit in order to reach 20%.
These options give you more flexibility when deciding how you want to pay your PMI. We’re the only home insurance company that lets you compare homeowners insurance quotes and coverages from multiple providers. Simply enter your information once, and we’ll match you with a policy based on your input and frequently show additional options. The lender automatically adds your PMI charges to your monthly payment. When you refinance into a conventional loan and keep at least 20% equity in your home, you won’t be required to purchase mortgage insurance. Your lender is actually the party responsible for paying CMHC insurance costs.
After a fateful 2012 trip to the Middle East, she began leveraging credit card rewards to earn millions of airline miles in order to travel the world. Interest Rates may change between the time of your application and settlement of your loan due to market conditions. Use RATESDOTCA to shop around, and compare multiple quotes at the same time. In August, three companies raised their rates, which amounted to an increase of 0.025%, collectively. Segregated funds give the opportunity to grow wealth in the financial markets with an addition of insurance. Have Never owned a property that was your principal residence anywhere in the world at any time.
However, homeowners’ insurance rates vary substantially depending on your home’s specific situation, condition, how much coverage you want, and where you live. The location of your house determines the type of perils it could be exposed to, which will greatly impact the rate an insurance company offers you. For example, a house in a storm-prone zone will be more expensive to insure than one that isn’t. Lemonade Insurance is an online-only insurance company that uses artificial intelligence to provide notably fast home insurance quotes and claims payments. The company can provide a quote in a few minutes — you simply fill out a form on their website, choosing the coverage amount. They also have customer service available through text and phone calls to help you through the process if you need it.
So, in the event of your death, your loved ones might struggle to keep your home. Take an important step now to help protect your home and family with mortgage life insurance. Along with high property taxes, Texas is known for having some of the highest annual homeowners insurance costs. According to recent data from insurance.com, Texas ranked as quite expensive for this insurance at an average of $3,429 per year. That puts the Lone Star State right near Florida, Louisiana and Mississippi, all states that have heavy hurricane and flooding risk.
Different approaches offer six month installments, yet most strategies pay out for around a year. All things considered, your home loan is your most expensive outflow every month. In the event that you quit getting a pay due to being unemployed, would you be able to stand to continue paying your mortgage? On the off chance that the appropriate response is no, you should consider getting a mortgage protection insurance.
However, if you used any of the loan proceeds for business or investment activities, see the instructions for line 16 next. You can use this method if at all times in 2020 the mortgage was secured by your qualified home and the interest was paid at least monthly. 13.Enter the total amount of interest that you paid on the loans from line 12. See the line 13 instructions13.14.Divide the amount on line 11 by the amount on line 12. Enter the result as a decimal amount 14.× .15.Multiply the amount on line 13 by the decimal amount on line 14. Otherwise, you can use Table 1 to determine your qualified loan limit and deductible home mortgage interest.
Depending on where you are shopping for home insurance, there will be a list of things that won’t be covered on a standard policy. These include earthquakes, landslides, mudflows, and flooding. To install the web app, just visit the rate calculator on your smart phone and add it to your homescreen. Premiums listed here are for TILA/RESPA disclosure purposes only. Find your savings using the calculator below, or call our office for assistance with more complicated rates.
However, the longer the benefit period, the higher your premium. Mortgage disability insurance is connected to your mortgage, which is different from traditional long-term disability insurance. Long-term disability insurance pays a percentage of your salary, usually 50 to 60%. Many Mortgage Protection insurance policies are decreasing term policies.
On the other hand, MIPs pay for insurance to protect mortgage lenders in the event that the borrower doesn’t pay them back on an FHA loan. Although MIPs can add to a borrower’s cost, FHA loans offer lower down payments for those who may not have a strong credit score. If you have a VA loan, an FHA loan or a conventional loan that you took out before 1999, the rules we’ve mentioned regarding the cancellation and termination of PMI probably don’t apply. To find out whether you can stop paying private mortgage insurance with those loans, you’ll need to speak with your lender. If you sell a house and pay off the existing mortgage, the policy could terminate.
If your interest rate was only 1% higher, your payment would increase to $1,114.34, and you would pay $201,161.76 in interest. The page you’re on helps you compare current mortgage rates side by side. You can evaluate payments, rate holds and prepayment flexibility, and then visit each lender for more details. Insurance Premiums Tax is a tax paid by all life insurance companies, all stock insurance companies, all mutual insurance companies, and all captive insurers doing business in Kentucky.
However, your mortgage life insurance premium is usually fixed and is based on your mortgage balance on the date that you applied for mortgage life insurance. This means that your mortgage life insurance premium stays the same, while your maximum coverage benefit is reduced over time. However, this risk of default is eliminated if you make a down payment within a certain range, specifically between 5% and 20%.
With mortgage life insurance, your benefit goes down with each month you pay down your mortgage. In this respect, paying your house off early exacts a penalty that could cost you money. With traditional life insurance, on the other hand, you’ll get a set death benefit that won’t change if you decide to pay off your home early. Term life also covers you for a fixed period of time, unlike a mortgage protection plan, which is tied to your mortgage length. Prior to the automatic cancellation, you can submit a written request to your lender to have mortgage insurance cancelled once you have built up 20 percent equity in your house.
If your loan is financed by the Federal Housing Administration, you’re required to have an escrow account. If your loan amount is more than 80% of your property’s value, your lender will likely require you to have an escrow account. When you don’t hold much equity in your home, you may not be as invested in protecting it as your lender is — so, they’ll want to make sure your home insurance policy is securely in place and up to date.
But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Please contact an approved partner lender for the current MassHousing interest rate. While your condo association or co-op corporation has insurance on some things, this insurance doesn’t cover your personal items or interior of your unit.
Ask your lender or local government about the homebuyer assistance programs they offer. Check advertisements in local newspapers and on the Internet to get an idea of the best terms and rates. Be aware, however, that rates change frequently, and you may not be able to get the published rate. Ask about the lender’s requirements for a down payment, including what you need to do to verify that funds for your down payment are available.
This can occur via the principal being paid down, via home value appreciation, or both. FHA loans often require refinancing to remove PMI, even after the LTV drops below 80%. The effective interest savings from paying off PMI can be substantial.
- The policies are a mixture of traditional whole life and universal life.
- If your application is not approved, the insurer will provide you with a notice of decline.
- The monthly premium can be paid for by being added to the monthly mortgage payment.
- Private mortgage insurance is designed to protect a lender in case of a default on the loan.
On a 30-year fixed loan there are nine payments between the time you cross the 20% threshold and when the payments would auto cancel after breaking through the 22% barrier. If you had a mortgage insurance rate that was 0.5% of your loan amount, your savings would be $1,125. If you had a 1% mortgage insurance rate, you would save $2,250 in mortgage insurance payments over those 9 months. It’s very important that you cancel your mortgage insurance as soon as you can because the savings can be significant for your monthly payments. Let’s take our previous example of a $300,000 loan amount and assume this is a one-unit primary property.
‘Sponsored’, ‘Hot deal’ and ‘Featured Product’ labels denote products where the provider has paid to advertise more prominently. While Mortgage Insurance covers the lender, not you, it can be a way for first homebuyers to break into the property market without having the requisite 20% deposit. LMI is typically paid at the loan settlement and is usually added onto the loan amount.
If you pay over a set period, the lender adjusts your mortgage rate to cover the costs of insurance. Because a higher mortgage rate means higher monthly payments, you’ll end up paying more each month if you go for LPMI. That higher payment should be less than you’d pay if you used a separate PMI charge every month, but there’s no way to “cancel” the extra cost as you pay down your loan. Private mortgage insurance premiums are paid monthly, in addition to your mortgage payment, homeowners insurance, and property taxes. Borrowers must pay upfront MIP at closing and will also have their annual premium added to their monthly mortgage payments.
Which is why FHA zero down requires extra for insurance, it’s insurance against those possible losses, which is why it goes away after you’ve paid off a certain percentage of the assessed value of the home.
— Tony "tshirtist in chief" Tribby 🇺🇸 (@tonytribby) October 4, 2021
In some states , you can buy your home subject to a ground rent. A ground rent is an obligation you assume to pay a fixed amount per year on the property. Under this arrangement, you’re leasing the land on which your home is located. If you qualify for mortgage assistance payments for lower-income families under section 235 of the National Housing Act, part or all of the interest on your mortgage may be paid for you. You can use a special method to figure your deduction for mortgage interest and real estate taxes on your main home if you meet the following two conditions. If you’re a minister or a member of the uniformed services and receive a housing allowance that isn’t taxable, you can still deduct your home mortgage interest.
You must take care to deduct only those points legally allowable. Additionally, certain points not included on Form 1098 may also be deductible, either in the year paid or over the life of the loan. See the earlier discussion of Points to determine whether you can deduct points not shown on Form 1098. You can’t fully deduct in the year paid points you pay on loans secured by your second home. If you live in a house before final settlement on the purchase, any payments you make for that period are rent and not interest. This is true even if the settlement papers call them interest.
If you’re buying a property, your mortgage amount is usually the purchase price minus your down payment. If you’re renewing an existing mortgage, it’s the principal owed after your last mortgage term. With fixed-rate mortgages, your interest rate and monthly payment stay the same for the entire term. With variable-rate mortgages, interest rates change with the market.