Helpful Tips
It’s A Good Time To Look At Adjustable-Rate Mortgages
October 9, 2009 by James K Barath, CMPS · Leave a Comment
According to the Freddie Mac weekly mortgage rate survey, the relative cost of a 5-year ARM is dropping versus its 30-year fixed-rate cousin.
During the first 5 months of 2009, the products ran neck-and-neck. Today, they’re a half-percent apart.
On a $200,000 home loan, that’s a difference of $60 per month.
Adjustable-rate mortgages aren’t for everyone, but for the right household, they can be a terrific fit. A few scenarios that warrant consideration of a 5-year ARM include persons:
- Buying a home with an intent to sell within 5 years
- With a 30-year fixed mortgage and plans to sell within 5 years
- Interested in low payments and comfortable with longer-term interest rate and payment uncertainty
Additionally, with homeowners with existing ARMs may want to consider taking on a new ARM, if only to extend their initial, fixed rate period.
Before choosing an ARM, make sure to speak with your Certified Mortgage Planning Sepcialist about how adjustable-rate mortgages work, and what causes them to adjust. Although conventional ARMs are limited in how far they can adjust, it’s important to know the risks.
Need more expert advice? Ask the team of Certified Mortgage Planning Specialists at Benchmark Mortgage.
About the Author: James K Barath is a Certified Mortgage Planning Specialist, qualified liability advisor and your FHA Home Loan Expert. He is also a graduate of Purdue University, The CMPS Institute, Dale Carnegie Human Relations Course & Napoleon Hill Foundation's PMA Science of Success Class. It's your home and your future. It's his profession and his passion. He is ready to work for your best interest. Contact James Barath today for your Borrow Smart Analysis - the CALM Approach to Borrowing ! His Motto: I Facilitate the American Dream Through Responsible Mortgage Lending and Financial Literacy! 