Aside from that, people who want to consolidate their bills are drawn into mortgage refinancing. There are countless other reasons why people go for mortgage refinancing when buying a new home. However, it should be noted that not everyone benefits from mortgage refinancing. For homeowners with second mortgages, mortgage refinancing may backfire. This allows 15-year fixed rate mortgage borrowers to build equity much quicker. And with a 15-year fixed rate mortgage, the overall interest bills are low - at least, considerably lower than those of longer-term loans. Interest rates of a 15-year fixed rate mortgage are also lower than 30-year loans. Inflation means a growing economy and increasing prices of goods and services. A growing economy means a stronger demand for goods and services, allowing producers to increase their prices. This therefore results in higher real-estate prices, higher apartment rents, and higher mortgage rates. In an effort to reduce inflation and slow down economy, the Federal Reserve lowers down interest rates, and in the process, decrease mortgage rates. If you're planning to keep your home for only a short period of time, then an adjustable rate mortgage might be the best choice for you. Adjustable rate home mortgage rates are significantly lower than fixed rates, especially during the initial years of the loan term. Lower adjustable rate home mortgage rates means lower monthly payments, making it easy for people to qualify for a loan. Instead, they work independently as free lance agents who are on the look out for borrowers looking for a good mortgage. So what? Looking for a home mortgage usually involves you, your money, and a bank officer or a mortgage broker. So what's the big deal? You ask. The end result is the same - you get a mortgage; you get a new house. Some lending companies structure their 80 20 mortgage loan with the first loan having a 5/1 ARM payment. This means that the 80 20 mortgage loan has a fixed rate for the first five years. However after the initial five years, the payment for the 80 20 mortgage loan interest rates is adjusted annually.