Taking out a mortgage is no joke. They’re most likely the largest loan any of us will take out in our lifetime. But “mortgage” isn’t a blanket term. There are many different types of mortgages. And one size does not fit all. Each has unique advantages and disadvantages. 

The 30-Year Fixed Mortgage 


A home loan with a fixed interest rate for 30 years.

With this type of loan, your interest rate never changes.

Pros of a 30-Year Fixed Mortgage:

This type of loan gives you the smallest possible monthly payment. You always have the flexibility to pay the loan off faster, by paying a little extra each month. It’s the most popular mortgage choice. 9 out of 10 home buyers opt for a 30-year fixed mortgage. This loan is predictable. It isn’t affected by the ebbs and flows of our (sometimes tumultuous) economy.

Since your monthly payment is lower, it can mean that you’re eligible for a larger house. Your quality of living is likely to increase.

Lower monthly payments leave more money in your budget for other financial goals. Whether you’d like to put a 6-month emergency fund on stand by. Or start investing in the stock market. Or start a college fund for your kids. Whatever you’re dreaming about- the flexibility is there.

Cons of a 30-Year Fixed Mortgage:

You end up paying more interest.

You’re stuck with a higher interest rate. The lender’s risk is higher with a 30-year mortgage. Their risk of not getting paid back increases with time. So they’ll charge a higher interest rate to protect themselves.

It also put you in danger of over-borrowing. It’s hard not to become starry-eyed when touring homes. If you opt for a larger, pricer home… your mortgage payment isn’t the only payment you need to anticipate. Larger utility bills and higher annual maintenance should also be factored in.

The 15-Year Fixed Mortgage 


A home loan with a fixed interest rate for 15 years.

Pros of a 15- Year Fixed Mortgage

The interest rate never changes throughout the life of your loan. Typically, this interest rate is significantly lower than 30-year mortgages. Your payments are predictable. You know exactly what to expect each month. Your total interest payments are less than they would be with a longer loan. This lower interest rate makes it a great option for refinancers.

You’ll also build home equity faster… because you’ll pay the principal quicker. It’s a streamlined way to full homeownership. Owning a home out-right is important to many people. So even though your monthly mortgage payment is much higher, you’ll have no monthly mortgage payment before too long.

Cons of a 15-Year Fixed Mortgage

Your monthly payment could be almost double the monthly payment in a 30-year mortgage. 

The Adjustable-Rate Mortgage


An adjustable-rate mortgage is a home loan with an initial interest rate that is fixed. Then, that interest rate adjusts periodically. For example, a 6/1 ARM has an interest rate that is set for the first six years. Then, it adjusts annually depending on the economy.

These types of loans are best for buyers who don’t plan on having a mortgage for a long time. This can be a good option for someone who knows he/she will be relocating soon. Or it can be a good option for anyone who anticipates an increase in wealth in the next few years. Possibly due to retirement or an expected inheritance. Or anyone who feels confident that interest rates will be lower in the future. Buying during a stormy economy is a good time to use this type of mortgage. If economic interest rates fall, your monthly payment will too.

FHA Mortgage


FHA Mortgages are backed by the Federal Housing Administration. These loans are backed by the government. They’re designed for lower-income borrowers. It provides a good opportunity for those to break into the housing market.  It allows for down payments as low as 3.5 and credit scores as low as 500. There is a common misconception that FHA’s are for first-time homebuyers only. And that conventional loans are for seasoned buyers only. But this isn’t necessarily the case. FHA’s can be a good option for any type of modest buyer. 

Cons of FHA loans.

The home has to be your primary residence. It must be lived in. Investment properties flipped homes, and rentals aren’t eligible for FHA’s.

There are loan limits to FHA’s. The 2021 national FHA loan limit is 356,362 in low-cost areas and 822,374 in expensive areas. The current loan limit for Dane County is $356,362.

VA Mortgage


VA Mortgages are backed by the Department of Veterans Affairs. They’re only available to those that have served in the US military.

If you’ve served in the military you should absolutely take advantage of the VA mortgages. There’s no down payment required. No mortgage insurance is required. There are very limited closing costs. And these mortgages are always set at a very low interest rate.

There are almost no downsides. The exception is that not all properties qualify. And you can’t use a VA loan to buy an investment property or vacation home.

Check to see if you qualify for a VA mortgage. 

USDA Mortgage 


USDA mortgages are loans given by the US Department of agriculture. They exist to boost the economy of rural and suburban areas.

If living in nature appeals to you, a USDA mortgage could be a great option. Typically, you’re not beholden to a downpayment. You’ll have access to home improvement loans and grants.

However, income caps apply. So do property value caps.  And typically there are very specific zip codes that this applies to.

Here are the Madison-area Counties eligible for USDA loans:

  • Manitowoc County 
  • Marinette County 
  • Marquette County 
  • Menominee County

Check the price requirements for each county here. 


We’ve got several loan officers that we love to work with! Just reach out and we’ll get in you in touch with the best.