Conventional mortgages are typically underwritten according to the guidelines set by Fannie Mae and Freddie Mac. These typically come in two different types: fixed-rate and variable-rate mortgages.

Fixed-rate mortgages are the "classic" mortgage. They provide you with a set payment every month-both loan principal and interest-for the term of your loan, commonly 15 or 30 years, making them easy to budget and plan for over the long term. If interest rates go up, your payment won't be affected. (If interest rates go down, you may consider refinancing.) In some cases, you can pay extra on your mortgage without penalty, to allow you to pay your mortgage off quicker. They're great if you:

• Are a first-time homebuyer
• Need a predictable payment
• Are buying your home during a period of low interest rates
• Intend to keep your home for more than five years

Variable-rate mortgages, also known as adjustable-rate mortgages, are more complicated than fixed-rate mortgages. Their initial interest rate will usually be lower than a fixed-rate mortgage. However, the interest rate of the mortgage will change over time, and as a result, your payments may go up or down accordingly. They may be ideal for you if you:

• Don't expect to own your home for more than five years.
• Want to have the lowest interest rate possible, and are willing to hold the mortgage over a few years of higher rates hoping you will benefit from a lower average rate
• Expect to make a higher salary eventually
• Expect interest rates to decline
• Plan to downsize your home once your kids go off to college

About Embrace Home Loans

We're a direct lender for Fannie Mae, Freddie Mac, and an approved Ginnie Mae issuer for FHA insured mortgages. With Embrace Home Loans, you can get the loan you need. As a direct lender, you deal with us, and only us. We'll lend you the money you need, whether it's for a new home, a home renovation, a college education, or to get ahead on your high-interest debt. And we can do it in as little as 21 days. Don't put off your brighter tomorrow. Fill out our quick, no-obligation, and confidential form. Or call 1-800-620-6292.