For many who purchased homes or refinanced old loans with adjustable rate mortgages [ARMs] several years ago, those incredible introductory rates are about to end. As three-year introductory rates end and five-year adjustments begin to appear on the horizon, now is a good time to consider your options. 
The first interest rate adjustment on an ARM is sometimes shocking and can result in a sudden increase in the amount of your mortgage payments. Borrowers with outstanding second mortgages or home equity loans might want to consider refinancing into a single, fixed rate loan. The new rate could easily be less than the combined rate of multiple loans. This can provide a lower monthly payment and eliminate future rate adjustment risk. Remember: even if your current payments are comfortable, future adjustments could make those new mortgage payments less comfortable.
This is also a good time for borrowers who, due to a poor credit scores started out in an adjustable rate loan to transition into a fixed-rate loan if they can. If a positive track record of making mortgage payments on time can been established, there's a very good chance you may now qualify for a loan with a lower interest rate.
Check with a Mortgage Professional to explore your options.
Kim Murphy, 1st Advantage Mortgage
Providing home loans for Illinois, including DuPage, Kane, Lake and Cook Counties for over 10 years.
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