Fixed-rate mortgage: This is defined as a mortgage in which the interest rate does not vary during the mortgage term. In this case the installments are constant, that is to say, they do not vary throughout the life of the loan.
If the interest rate is fixed, it means that the percentage applied to the debt to calculate the interest does not vary.
The fixed rate mortgage is one in which the interest rate does not vary at any time and the installments are the same throughout the life of the loan. The fixed rate mortgage is usually a good solution for those who are risk averse or for those who foresee continued increases in interest rates.
A fixed rate mortgage offers the security that the borrower will always pay the same amount, so it can also be a solution for those who cannot afford to pay more than the initial payment.
It is also important to take into account that the risk of an increase in the installments disappears with this type of mortgages, but in exchange, in general, in principle, the installments will be higher than those of the variable rate mortgages that are contracted at the same time. This is because the banks apply a higher interest rate than that which exists at that moment for variable rate mortgages.
In general, mortgages with a fixed interest rate have higher early amortization and repayment fees than variable rate mortgages.