Mortgage lenders have a large supply of cash and they are eager to lend it to you, and they are offering many new kinds of loans. Here is a quick guide:

If you are buying your second or third home and plan to stay a few years, you may well want a fixed rate mortgage. Its virtue is predictability. The rate you pay will be slightly higher at first than those you would get with other kinds of mortgages, but it will remain constant, and the equity from your previous home should help you afford it. Rates on fixed rate 30 year mortgages are available at 6.25%.

Then there is the initially more affordable adjustable rate mortgage, or ARM. It is inviting for younger buyers who expect their salaries to grow rapidly. When you get an adjustable mortgage, the initial rate you pay is usually two or three percentage points lower than on a fixed rate loan. After a year or so the rate rises and then it goes up or down periodically along with interest rates in general. To draw customers, lenders generally offer adjustable mortgages at interest rates below fixed rate loans. This enables you to start off paying low rates. But after the first interval, the monthly payment will change.

Adjustable rate mortgages once were limited mainly to less affluent first time homebuyers who could not qualify for the higher priced fixed rate loans and needed that first year break on interest payments. But now so called ARMs are becoming popular among people who are trading up to second and third houses and who can afford whatever loan they want. The reason: If interest rates fall or just hold steady then these borrowers can save thousands of dollars in interest costs compared with what they would have to pay with a conventional mortgage. One study has shown that people who took out adjustable rate mortgages in recent years have done significantly better than those who had fixed rate loans.

If you cannot decide between an adjustable rate or a fixed rate loan, the solution may be the increasingly popular offering called a convertible mortgage. It starts out with an adjustable rate that is usually several percentage points lower than that on a fixed rate mortgage. But if, for example, interest rates drop in the future, you can convert to a fixed rate mortgage at the then current rate for such loans.

When you go shopping for a mortgage, start by looking in your newspaper to see what local lenders are offering. Then look for a real estate broker who uses a computerized service, which can make comparison shopping a lot easier and faster. In many cities and suburbs, a broker will punch into a notebook computer the size of the loan you are looking for, the amount of your income and other details of your finances. The computer then displays on its screen descriptions of different mortgages that are available from various lenders. It also displays the latest interest rates being offered and tells you if you are likely to qualify for a particular loan. In some cases, these services permit you to apply for the mortgage electronically. You never deal with the lender in person and the papers are simply mailed to you for signing.The most valuable matchmaking services are clearinghouses for mortgages from many lenders, including those in faraway places where money may be more easily available and interest rates more competitive than in your own area.