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A fixed rate mortgage provides you, the borrower, with a fixed interest rate over the whole term of the loan. These loans are the easiest to understand. You can count on the principal and interest payment amount staying the same every month for the entire term of the loan.

At the end of the term of the loan, your loan balance is zero. Remember, however, if your loan includes an escrow account, the escrow portion of your monthly payment may change annually when escrows (annual tax and insurance payments) are analyzed.