With balloon payment mortgages, if you can't pay the lender the amount on the due date, you might have to foreclose and lose the property. Some lenders offer extensions for their 30-years-due-in-7 balloon payment mortgages. Lenders of this type of loan may extend your balloon payment mortgage for another 23 years but with a new interest rate. Whichever is the case, interest-only mortgage rates are always tied to the libor index. The libor index of interest-only mortgage rates stands for London Interbank Offered Rate. LIBOR is the interest rate offered by a specific group of banks in London for matured U.S. dollar deposits. Choosing libor index as basis for your interest-only mortgage rates entitles you to a number of benefits. Discuss the repayment terms of the second mortgage loan with your bank or lending company. For instance, you get a second mortgage loan worth $20,000 to make some home repairs. With this amount, you might want to take on a second mortgage loan that will allow you to repay the entire amount in one or two years. With a variable rate mortgage interest rate of less than 0.60% for a full five-year term, ING Direct variable rate mortgages are among the top-sellers. As an added bonus, consumers who buy their variable rate mortgages from ING Direct have the option to convert their variable rate mortgage into a fixed rate mortgage of 3 years or more. Fixed Rate Home Mortgage Fixed rate home mortgages are home mortgages whose interest rates remain set for the duration of the loan term. The monthly payments for a fixed rate home mortgage may either for a period of 15 years or 30 years. Fixed rate home mortgages are considered stable. With fixed rate home mortgages, your interest rates are guaranteed and your monthly payments are predetermined. In single loan term, the amount you pay to cover the mortgage interest rate cost is more often than not more than what you paid for your house. Reducing even a fraction of your mortgage interest rates can save you a great deal of money on your mortgage. The rise and fall of mortgage interest rates have become erratic during the past 20 years.