An adjustable rate mortgage, called an ARM for short, is a mortgage with an interest rate that is linked to an economic index. The interest rate and your payments are periodically adjusted up or down as the index changes.
· Subject: Need advice – is an ARM mortgage loan a good idea? anonymous: anonymous wrote:Unless you are planning to move within a few years I would steer clear of ARMs at the moment. Interest rates only have one way to go, and they could go some way. It isn’t crazy to think interest rates could be 7 or 8 percent in 10 years time.
3 Reasons an Adjustable-Rate Mortgage Is a Bad Idea – At first glance, an adjustable-rate mortgage, or ARM, is a rather eye-opening thing. It boasts the lowest interest rates, and the payment made on the loan is often 15% or so less than on a traditional.
Adjustable rate mortgages offer pros and cons. Ultimately, whether ARMs are a good deal for you depends on several factors, including how long you plan to be in the home you buy. If you intend to sell it within five years, before the adjustable rate changes, for example, an ARM may be right for you.
The 30-year fixed-rate mortgage averaged 3.73% in the June 27 week, down 11 basis points, Freddie Mac said Thursday. The 15-year fixed-rate mortgage averaged 3.16%, down from 3.25%. The 5-year.
The 15-year fixed-rate mortgage averaged 3.28%, down from 3.46%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.52%. new research shows that most consumers have little idea.
Adjustable rate mortgages, or ARMs, can be a gamble for home buyers.. arms, many financial advisors are not exactly thrilled with the idea.
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The adjustable-rate mortgage (commonly known as the ARM loan) has an interest rate that will adjust or "reset" at a predetermined frequency – every three years, every five years, etc. This is very different from the fixed-rate mortgage loan, which holds the same interest rate over the entire life of the loan.
With an adjustable rate mortgage, you can attain a low rate for a fixed period of time. Your low interest rate will stay fixed for a period of five to seven years before it adjusts up or down depending on the market at that time. So if you’re in need of a home loan, it’s a good idea to lock your rate in now!