| Once you've found a lender and have set a realistic budget, you should start learning about the different types of loans. You will need to consider the pros and cons of different loans based on your needs. Some loans may have higher rates but lower payments at the beginning; others carry lower rates but possibly higher payments. Some have steady payments, while others have payments that may go up or down. The key to understanding why loans behave this way is to understand "risk" and who is taking the most risk — you or the lender. | | Risk can refer to many things, but in general in mortgage lending it is two things: the risk of interest rates going up or down and the risk of the loan not being paid back. On the Mortgage Types page, you will find information about how loans can vary within the basic types, such as the differences in adjustable-rate loans. We hope these explanations can help you narrow down the type of loan you want and how you want that loan to be structured. Your lender is the best person to help you explore your options, but the choice is yours.
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