If you’re considering a mortgage refi you might be tempted to choose an ARM to take advantage of interest rates below 4%. Are the risks worth the short-term benefits of an Adjustable Rate Mortgage? Here’s an article from Investor’s Business daily weighing in on the pros and cons of Adjustable Rate Mortgage loans:
It’s harder to qualify for financing these days, but the same basic choice about which way to go still comes up: fixed-rate or adjustable-rate mortgage. ARMs have come in and out of vogue over the years. They’re tempting and popular when they offer big savings vs. fixed, but fall out of favor when rates start rising, pushing up monthly payments.
Once you’ve decided which type of mortgage refinance is right for you there’s more to your refi than getting today’s
best refinance rates. The fees you pay for mortgage origination and closing costs actually decide how good of a deal you’re getting on your new home loan.
The reason your closing costs are so important is that you’ll have to recoup these before gaining any benefit from your lower payment amount. The more you pay at closing the longer it’s going to take to break even…not to mention paying less keeps more cash in your pocket for other things.
You can learn more about getting the lowest mortgage refinance rates for your next home loan without paying unnecessary lender fees and markup by checking out my free Underground Mortgage Refinance Videos.