If a buyer has a fixed-rate mortgage, what aspect of the payment will remain unchanged?

If a buyer has a fixed-rate mortgage, what aspect of the payment will remain unchanged?

• A. Property taxes
• B. Insurance payments
• C. Principal and interest payments
• D. Home maintenance costs

Answer: (C)

In a fixed-rate mortgage, the principal and interest payments are set at the beginning of the loan term and remain constant throughout the life of the loan. This means that the borrower pays the same amount in principal and interest each month, with no fluctuations due to interest rate changes, making budgeting simpler and more predictable for homeowners. Other aspects of homeownership, like property taxes and insurance payments, can fluctuate based on market conditions or changes in property value. Home maintenance costs are also variable and can change depending on the age of the home, needed repairs, and other factors. Thus, while principal and interest payments stay fixed, all these other costs may increase or decrease, making them less predictable in the long term.

In a fixed-rate mortgage, the principal and interest payments are set at the beginning of the loan term and remain constant throughout the life of the loan. This means that the borrower pays the same amount in principal and interest each month, with no fluctuations due to interest rate changes, making budgeting simpler and more predictable for homeowners.

Other aspects of homeownership, like property taxes and insurance payments, can fluctuate based on market conditions or changes in property value. Home maintenance costs are also variable and can change depending on the age of the home, needed repairs, and other factors. Thus, while principal and interest payments stay fixed, all these other costs may increase or decrease, making them less predictable in the long term.