02/02/2022
Interest Rates are still at an all time low! But how do you know what type of mortgage to get? Fixed Rate or an Adjustable Rate (ARM)?
When you take out a fixed rate mortgage, you know before you sign your closing papers exactly how much your mortgage payment will be each and every month for as long as you have the mortgage. Many people value this stability.
If you want to use an ARM because its lower interest rate will help you qualify for financing to purchase a more expensive property, consider whether the difference in the quality of property you can get with the ARM makes the interest-rate risk worthwhile. You're going to be tempted to say, "Yes! Of course!" because of the amazing school district, new hardwood floors or wonderful neighborhood. but try to envision how you would feel about that property and would you still be able to do it if your monthly payment went up because your interest rates went up under ARM
Some reasons to consider ARM:
* planning to move before the loan resets
* they’ll be able to refinance before the loan resets
* their income will increase before the loan resets
What do you think fits your the best?! Fixed rate or ARM?
