With interest rates at their lowest, most homebuyers ask the tough question, "Should I fix my loan or not?"

Increasing interest rates can have a big impact on your lifestyle. And because of this, you should consider your future plans, budget, and financial flexibility when deciding whether or not you want to fix your loan.

A fixed-rate mortgage loan allows you to set an interest rate for a certain period of time. The most popular term ranges from one to five years. During this period, your interest rates and monthly repayments remain the same, whether or not lenders change their interest rate increases. At the end of the fixed term, you have the option to fix the loan again or change to a variable rate loan option. Whether you're new to the home buying business or going out to buy a second home or property, it might be the right time to get a fixed-rate mortgage loan. Setting the rate on your home loan is one way to manage risk. If raising interest rates would have a significant impact on your ability to repay your loan, then setting your rate makes perfect sense.

However, before making such a big decision to choose to fix your home loan, there are several factors to consider. First of all, you should look for a lender that offers you some flexibility, and you should also ask yourself and perhaps get some advice on how things will turn out three years or five years after the time you are considering fixing your loan. Fixing for a shorter period can make more financial sense while watching market trends.

Do you love certainty? The main advantage of fixed-rate mortgage loans is the fact that you can sleep better at night and even plan ahead because you already know what your monthly obligations are. However, one of the downsides to opting for a fixed-rate home loan is that most lenders won't let you pay off your loan early or make additional payments without incurring penalties.

If you're still undecided, there's always the option of having your cake and eating it. The divided loan option gives you the opportunity to fix part of your loan and the other part is subject to a variable rate.

Once you have done your homework and decided what type of loan to choose, always remember that if you don't ask, you won't get it. If you are using a mortgage broker, ask the broker to negotiate the most flexible option that meets your financial situation, https://www.cambridgehomeloan.com/vahomeloan/.

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Is it the right time to fix your home loan?