Fixed Rate Mortgages are home loans with steady interest rates and monthly payments that do not change throughout the life of the loan. These mortgages rates are especially attractive to borrowers when interest rates are low because loans are more affordable. Furthermore, borrowers do not have to worry about their payments drastically increasing from period to period. Again, the major benefit to having a fixed rate mortgage is that the payments are the same each month.

Common Fixed Rate Mortgages Include:

• 15-Year Fixed Rate Mortgages
• 30-Year Fixed Rate Mortgages
• Biweekly Mortgages
• "Convertible" Mortgages
• Balloon loans
• Fixed Rate Interest-Only Mortgage Loan

15-Year Fixed Rate Mortgage
The 15-year fixed rate mortgage enables several built-in advantages over the traditional 30-year fixed rate. It takes half the time for homeowners to own a home without any remaining payments as well as include half the total interest costs of a 30-year plan. However, monthly payments will be higher, but if you can afford a 15-year fixed rate mortgage, it can save time and money over traditional loan funds.

30-Year Fixed Rate Mortgage
Since the early 1950's, 30-Year Fixed Rate Mortgage has been a staple of the mortgage industry. The ever-changing market has brought variations over the years, but this is still the best mortgage choice for many homeowners.

Fixed Rate loans offer the lowest monthly payments of a fixed rate mortgage and provide a never-changing monthly payment cycle. Lenders can offer 10 to 40-year term mortgages, but keep in mind the longer the payment terms the more interest that will need to be paid.

Biweekly Mortgage
The biweekly mortgage shortens a loan's term to 18-19 years by structuring a payment schedule for half the monthly amount every two weeks. This results in an annual payment increase of 8% for 13 monthly payment, or 26 biweekly payments in a year. Much like a 15-year fixed rate, this payment structure decreases interest costs dramatically.
By chopping away at the principle, costs are decreased even more. Interest is calculated every 14 days according to principle amount. This results in reduced mortgage interest deductions, and may be worth looking into if it is available.

Convertible Mortgages
Convertible fixed rate mortgages offer homebuyers flexibility to adjust the loan's interest rate after a specified period of time or movement in interest rates. These mortgages are often called the Reduction Option Loan (ROL), Reducing Interest Loan (RIL) or Mortgage (RIM).
These terms are normally a set faction in rates typically 2% below the initial rates during a given time-frame between designated months.
On a 30-year fixed rate mortgage with a reduction option, the homebuyer pays extra on interest rates, thus allowing homeowners to adjust interest rates without refinancing. Refinancing can cast 5% to 6% of the loan amount if the rates are right during the designated time limit.

Balloon Mortgages
Balloon Loans are short-term mortgages. They have similar features of a fixed rate mortgage, but as opposed to a 30 year fixed rate mortgage, they do not fully amortize over the original term. Most balloon loans have a term of 5 to 7 years.
Since Balloon mortgage loans do not fully amortize, at the end of the loan term there is a remaining principal loan balance. This balance for the loan is to be paid in full, often times through refinancing. You may even be able to utilize a conversion feature that some companies have set up. For example, you want to convert to a 30 year fixed loan at the 30 year rate plus 3/8 of a percentage point. This is guaranteed given that your last 24 payments were on time. These programs with a conversion option are referred to as a 7/23 Convertible or 5/25 Convertible. 

Fixed Rate Interest-Only Mortgage Loan
Fixed Rate Interest-Only Mortgages enable borrowers to lock in an interest rate for the life of a loan, yet reduce their monthly outlays by paying interest and not principal, typically for the first 10-15 years. These loan types are fairly new and account for approximately 8% of all new residential mortgages taken out according to UBS AG, a financial services firm.
These mortgages are a great way to live in a house that you would otherwise not be able to afford. They do however come with many drawbacks.
Borrowers who make interest-only payments don't build up equity in their homes, apart from increased value of a home. If you home does not increase in value, you can kiss equity goodbye. Homeowners can be hit with quickly rising monthly payments once the interest-only period ends. This results in the borrower having to repay the balance of the mortgage over the rest of the loan's term. These payments include both interest and principal.
To reduce "payment surprise", it is a good idea to make principal payments. As this happens, the required interest-only payment is reduced according to the lower loan balance.