It depends on your situation.
Variable and Fixed
About interest rate, there are variable and fixed.
Variable interest rate
Interest rates change every six months. So monthly payments may change.
However, monthly payments are often lower than with fixed interest rates.
Fixed interest rate
Interest rates are fixed by the period. A typical example is "Flat 35."
"Flat 35" is an easy-to-use housing loan. Foreign nationals often use this.
Detail "Flat 35"
Differences in payments
Differences between monthly payments for variable and fixed interest rates.
Variable interest rate
It is likely to change every six months.
Ex.
1-6 months : Amount × rate = A
6 months to 1 year : Amount × rate = B
1 year to 1 and half years : Amount × rate = C
After D, E, F.........
The following changes every six months. So monthly payment goes up and down.
Fixed interest rate
Basically, it is set for 1-5 years and 6-35.
Ex.
1-5 years : Amount × rate = A
6-35 years : Amount × rate = B
You don't have to worry about monthly payment. Because it is fixed from the start.
Differences in calculations
Also, differences between calculating monthly payments for variable and fixed interest rates.
Variable interest rate
Ex.
Amount × rate = A = monthly payment
Just multiply amount by rate but, monthly payment goes up and down every six months.
Fixed interest rate
Especially, in case of "Flat 35".
Ex.
(Amount × 90%) × rate = A
(Amount × 10%) × rate = B
Total (A + B) = monthly payment
Generally, divide amount into 90% and 10%. This is rule of "Flat 35".
Depending on the examination, the amount may be divided into 80% and 20%, or 70% and 30%.
After that, multiply each divided amount, A and B by a different interest rate.
It all depends on the examination, but it is a good idea to know the difference between fixed and variable interest rates.
How to inquiry
If you want to ask in detail,
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Emai address consult@guiadesign.com
This site www.guiadesign.com/dream
Please feel free to contact us.
🇯🇵 A national qualified expert try to give you
advice that suits your current situation.
GUIA DESIGN OFFICE
Ibaraki Association of Architectural Firms
B5464 0309
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