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Rainmaker
3,338,547
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

The borrower can not afford the payment increase!

Sep 19, 2019 04:31 AM
Rainmaker
1,500,077
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

Simple: the monthly payment might skyrocket. 

Sep 18, 2019 11:01 PM
Rainmaker
5,081,147
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

when rates increase, at the time of adjustment, that rate will follow suit.... 

Sep 18, 2019 03:41 PM
Ambassador
3,399,382
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

The interest rates max out.

Sep 19, 2019 10:15 PM
Ambassador
4,320,673
Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams Fox Cities - Stevens Point, WI
Forestland Experts! 715-204-9671

They often go Up.

Sep 18, 2019 08:38 PM
Rainmaker
2,810,351
Kathleen Daniels
KD Realty - 408.972.1822 - San Jose, CA
San Jose Homes for Sale-Probate & Trust Specialist

rate increases 

Sep 18, 2019 04:59 PM
Rainmaker
3,175,227
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

The rate could go up.

Sep 18, 2019 03:02 PM
Rainmaker
229,760
Joseph Domino 480-390-6011
HomeSmart - Scottsdale, AZ
Real Estate Made Easy

The rate could go up! Knowing what index is used and how often it may adjust are important factors.

Sep 18, 2019 03:01 PM
Rainmaker
1,215,772
Valeria Mola
SIB Realty - Miami, Sunny Isles Beach - Sunny Isles Beach, FL
305-607-0709 SIB Realty

Rate can be higher

Sep 18, 2019 02:59 PM
Rainmaker
2,830,702
John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Many great responses.

Sep 19, 2019 03:45 PM
Rainer
241,054
Caroline Gerardo
CMG Financial - Newport Beach, CA
C. G. Barbeau the Loan Lady nmls 324982

You have a low 5 year mortgage and you decide to stay 30 years; but can't get a new loan on month 58

Sep 19, 2019 03:04 PM
Rainmaker
1,650,269
Evelina Tsigelnitskaya
SIB Realty - Sunny Isles Beach, FL
www.SIBRealty.org 305-931-6931

Now you know, Anonymous

Sep 19, 2019 11:32 AM
Rainmaker
5,462,604
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Rates can rise. ARMs work best for home buyers who will not be in the home for many years.

Sep 19, 2019 06:28 AM
Rainmaker
741,220
Olga Simoncelli
Veritas Prime, LLC dba Veritas Prime Real Estate - New Fairfield, CT
CONSULTANT, Real Estate Services & Risk Management

Rate "adjusts" over time (goes up) to unaffordable levels.

Sep 19, 2019 05:31 AM
Ambassador
4,047,391
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

The rate can and likely will go up after a period of time depending on the loan, possibly significantly

Sep 18, 2019 08:34 PM
Rainmaker
1,256,672
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

They adjust upwards

Sep 18, 2019 06:39 PM
Rainmaker
937,670
Thomas J. Nelson, Realtor e-Pro, CRS, RCS-D, Vets
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

What Barbara Todaro said.

Sep 18, 2019 05:26 PM
Rainmaker
567,409
Peter Testa
Nationwide Homes - Danbury, CT
PETER TESTA

Rates going up.

Sep 18, 2019 05:01 PM
Rainmaker
4,534,484
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

rate could go up

Sep 18, 2019 04:57 PM
Rainer
155,052
Byron K . Jones
Coatesville, PA
List Today - Sold Tomorrow!

Rates are "Adjustable"

 

Sep 18, 2019 03:02 PM
Rainmaker
704,906
John Juarez
The Medford Real Estate Team - Fremont, CA
ePRO, SRES, GRI, PMN

Scanning the comments...it looks like everyone is on the same page with this one.

Me, too.

Sep 23, 2019 03:58 PM
Rainer
2,350
Aida Mukhtar
home improvement station - Albany, NY
I’ve always had a passion for DIY, being creative,

The main reason to consider adjustable rate mortgages is that you may end up with a lower monthly. The bank (usually) rewards you with a lower initial rate because you're taking the risk that interest rates could rise in the future. Contrast the situation with a fixed rate mortgage, where the bank takes that risk.

Sep 21, 2019 07:19 AM
Rainer
7,150
Glen Williams
Staffordshire Home Advisors, LLC (770) 672-5115 - Marietta, GA
Home Inspector serving in Marietta and GA cities

The main reason to consider adjustable-rate mortgages is that you may end up with a lower monthly. The bank (usually) rewards you with a lower initial rate because you're taking the risk that interest rates could rise in the future.

Sep 20, 2019 09:44 PM
Rainmaker
815,209
Mel Ahrens, MBA, Kelly Right Real Estate
Kelly Right Real Estate - Hood River, OR
Customized Choices for your Real Estate Needs

You should look and the positives and negatives of ARM's. There are some benefits; an ARM is beneficial as long as it meets the specific situation of the borrower.  For example, a borrower with a 7-year ARM who knows they will be moving in 5 years typically will have a lower interest rate, with the rate fixed for their time horizon. Making an informed decision knowing the positive benefits and the potential negative consequences is the answer. Focusing only on the negative will lead to an uninformed decision.

Sep 20, 2019 12:22 PM
Rainmaker
4,134,767
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Borrowers used to only have to qualify for the mid-range rate, not the top rate.

Oct 05, 2019 08:15 AM