A fixed-rate mortgage locks in both your interest rate and monthly payments for the entirety of your loan, providing the peace of mind that comes with stability. This is the most traditional form of a mortgage. Reasons to consider a fixed-rate mortgage include:

• Predictable budgeting: Your repayment responsibilities will be clear.
• Interest rate stability: Your payment will hold steady for the entire term of the loan.
• Flexible terms: Most borrowers opt for a 30-year mortgage, but shorter periods like 15 or 20 years may be a better fit for your goals.

Fixed-rate mortgages are a good fit for most borrowers. They appeal to those who plan to own their home for a long duration and want peace of mind knowing their loan repayments will be predictable. Of course, if interest rates should fall during the life of the loan, borrowers could consider refinancing, but the goal is not to play the guessing game.

The number of years attached to a fixed-rate mortgage isn't the only difference to consider. So here's a rundown of some of the vocabulary you'll see next to fixed-rate loans:

Conventional fixed-rate mortgages

Conventional fixed-rate mortgages generally come with slightly stricter requirements for approval. However, there are some exceptions to these rules. These loans are allocated by banks, credit unions, online lenders, and other types of lending institutions.

FHA, VA, and USDA loans

FHA, VA, and USDA loans have fixed rates and come with less strict requirements than conventional loans. FHA loans are broadly available, while USDA loans are assigned to specific rural borrowers. VA loans are reserved for military service members, veterans, and qualified family members.

Conforming

A conforming loan adheres to prerequisites from the Federal Housing Finance Agency (FHFA), such as loan limit, that enable it to be sold on the secondary market.

Non-conforming

Non-conforming loans, including jumbo loans, don't meet FHFA requirements. You might pay a higher rate to qualify and need to check off stricter standards regarding your credit score and cash reserves.

Amortizing

Most fixed-rate mortgages are amortizing loans, which means that your monthly payments go toward both the preliminary and the interest charges. 

Non-amortizing

Non-amortizing loans are considerably less common but come with an appealing benefit: significantly lower monthly payments that might only cover the interest for a while.