What is the main advantage of a fixed-rate mortgage?

The main advantage of a fixed-rate mortgage is that the monthly payments remain constant throughout the loan term. This stability allows borrowers to plan their finances more effectively since they know exactly how much they need to pay each month, regardless of fluctuations in interest rates in the broader market. This predictability is particularly beneficial in a rising interest rate environment, as borrowers are protected from increases that could occur if they had a variable-rate loan.

The other options describe features that are not typically associated with fixed-rate mortgages. For instance, adjustable-rate mortgages do adjust interest rates periodically, which can lead to varying monthly payments. The suggestion that monthly payments can be lower in the initial years applies to certain loan types, like graduated payment mortgages or some adjustable-rate mortgages, rather than fixed-rate ones. The notion that a fixed-rate mortgage requires no credit check is misleading, as lenders do conduct credit assessments to determine the borrower's eligibility and potential interest rate. The consistent payment structure of a fixed-rate mortgage is a major draw for many homeowners seeking reliability in their budgeting.