Refinancing Strategies: What's Behind the Change?

 

Contact Us If you have an adjustable-rate mortgage (ARM), you may have selected it because of its lower initial interest rate, which provided the following benefit. Lower initial monthly mortgage payments than you would have obtained from a fixed-rate mortgage. However, that low initial interest rate doesn't stay that way forever; it's scheduled to change periodically. When and how often it changes depends on the type of ARM you selected: The initial interest rate can remain fixed for the first one to 10 years. After that, it's adjusted periodically based on financial market conditions and the type of loan you have. During the initial fixed-rate period, your monthly payments are lower than those of a fixed-rate loan. After the fixed-rate period expires, your loan will adjust every six months or every year, depending again on the ARM product you selected. Consult your loan agreement for details about how the adjustments are determined, the percentage that's added to determine your new rate, and the maximum amount the rate can increase over the life of the loan. Next Topic:Evaluating the Equity Effect Contact Us

Roger Hunt Private Mortgage Banker Office: 650-931-2940 Fax: 650-249-0249 Mobile: 650-796-0326 Contact Us 1440 Chapin Ave #200 Burlingame, CA 94010 Directions