If interest rates are on the rise…
Do you really want an adjustable rate mortgage?
According to the Federal Housing Finance Agency, one out of ten new home purchase loans in 2013 were ARMs. They are expecting those numbers to rise to 12% in 2014.
In the past few years, most people have stuck with fixed rates and played life a little more safely. Many of us are always looking for ways to save money though. Buyers are looking at more and more options when they decide to buy their next home.
It is true that options like ARMs and the newer Hybrid ARMs can initially offer a monthly savings. What happens when the fixed rate period is over? PLEASE ask this question of your lender if you are considering this option! Be absolutely sure you completely understand the lender’s explanation of the answer to this question. Keep asking questions!
Don’t ever forget the A in ARM stands for adjustable.