Which type of mortgage has a fixed interest rate and monthly payments that remain the same throughout the loan term?

A fixed-rate mortgage is characterized by having a fixed interest rate for the entire duration of the loan. This means that the amount of interest charged on the loan does not change over time, providing consistency for borrowers in budgeting their monthly payments. The monthly payments are structured to remain the same throughout the term of the loan, giving homeowners the ability to predict their financial obligations without the worry of fluctuating interest rates that can affect the affordability of their mortgage.

This stability allows borrowers to better plan for long-term financial commitments, as the principal and interest components of their mortgage payment will not change, even if market rates rise or fall. It contrasts with other types of mortgages, such as adjustable-rate mortgages, which have interest rates that can change at specified intervals, potentially leading to varying monthly payments.