arm: Did the subprime debacle kill the adjustable rate mortgage?
- 12/20/10 04:11 PM
A few days ago, I wrote about the assumability feature for FHA loans. Another program feature that has not been discussed much over the past few years is the adjustable rate mortgage. With rates near all-time lows, it may not make sense for most borrowers to choose an ARM. However, if you plan on staying in your home for a short time or you need the lower rate to assist you in qualifying, then an ARM may be an option. The subprime-loan debacle gave ARM products a bad name — primarily those that featured the "crazy first year adjustment." The first-year … (4 comments)
A few days ago, I wrote about the assumability feature for FHA loans. Another program feature that has not been discussed much over the past few years is the adjustable rate mortgage. With rates near all-time lows, it may not make sense for most borrowers to choose an ARM. However, if you plan on staying in your home for a short time or you need the lower rate to assist you in qualifying, then an ARM may be an option.
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