A lot of homeowners are dealing with a major mortgage setback this year. Florida and California are leaders in foreclosures so far and it is not over yet. Option ARM loans are primarily to blame. An estimated $1.5 trillion in adjustable-rate mortgages is scheduled for a rate adjustment and as we all know rates are currently going up.
So how can an average homeowner who has this kind of loan can deal with what's to come? Refinancing could be an option but depending on your situation it could be a costly move. It usually costs money - about 3 percent of the loan amount and when you do refinance into a 30-year fixed rate that currently goes for about 6 percent don't count on a lower monthly payment. If your ARM adjustment is close to this figure you can probably solve your problem by cutting your expenses. Sometimes cutting your phone or cable bill to basic can save you as much as $50 per month. Think of any other way to cut your monthly expenses and you can save a lot more. If you have an ARM that is adjusting above 6 percent consider refinancing but you should have a credit score of at least 720 and be willing to keep your house for 2 years or more. In this case you might be able to lower your monthly payment, just check those closing cost fees. If it is still not possible to cover a new payment consider selling your home. In case you owe more to the bank then what your home is worth short sale could be an option for you. Ask Dmitri Olympiev by visiting http://www.olympievfloridahomes.com/ to see if you qualify or to find out more. Going into foreclosure will cut your credit score by as much as 200 points so you will not be able to buy for a while. Just to compare, short sale will trim your score by only about 50 points so it is worth considering. Dmitri Olympiev wishes you good luck and remember - do anything you can to save your credit and make responsible financial decisions.