ARM mortgage rates will leap in 2007

[tristano's ghost]

Ah, life in the Bush economy:

ARM mortgage rates

According to the Times, this option surged in 2003. When my wife & I bought our first house in '99, a realtor tried to push one of these on us... we said NO THANKS. We're buying a bigger house now and locked in at 5.5 for a 30-year fixed.

As Atrios said, 2007 could be a very bad year.

[Monte Smith]

Depends on the term of your ARM, doesn't it? An ARM is certainly a riskier loan product than a traditional fixed rate mortgage, and you shouldn't take one on if you think you won't be able to make increased payments five, seven, or ten years on (depending on the terms of your ARM). Or if you think you are going to stay put for a long time. On the other hand, an ARM offers a cheaper way to buy a loan if you think you are going to move soon. There are advnatages and disadvantages to this or any financial option. You can't say blankly that it's a good option or a bad option, because it depends on your situation and what you are looking for. No option is a good option, however, if taken up in ignorance of what you are getting yourself into. That's why it behooves all people to educate themselves in basic home economics.

[jesus marion joseph]

How the hell can anyone say what the rates will be doing in 2007 with any certainty? I'd be more concerned with what they're doing for the rest of 2005, personally.

[Doc Martin]

Originally Posted by Monte Smith

Depends on the term of your ARM, doesn't it? An ARM is certainly a riskier loan product than a traditional fixed rate mortgage, and you shouldn't take one on if you think you won't be able to make increased payments five, seven, or ten years on (depending on the terms of your ARM). Or if you think you are going to stay put for a long time. On the other hand, an ARM offers a cheaper way to buy a loan if you think you are going to move soon. There are advnatages and disadvantages to this or any financial option. You can't say blankly that it's a good option or a bad option, because it depends on your situation and what you are looking for. No option is a good option, however, if taken up in ignorance of what you are getting yourself into. That's why it behooves all people to educate themselves in basic home economics.

Sound advise, Monte

[Jon Abbey]

I can't wait for this goddamn real estate bubble to pop.

[Monte Smith]

It's an ill wind that blows no one no good. My 5-year ARM reset today. The worst case scenario was that it could go from 4.25% up to 9.25%. As it is, it will actually go down to just over 4%. This probably wouldn't have happened without the global economic meltdown, so cheers.

[claude]

Originally Posted by Jon Abbey

I can't wait for this goddamn real estate bubble to pop.

Funny to see some of these posts now... Seems Jon got his wish.