2007-02-18 11:23:37 · 3 answers · asked by casllc2003 2 in Business & Finance ➔ Renting & Real Estate
The 10/1 and 5/1 are fixed for 10 and 5 years, the 1 means they adjust once every year after the fixed period. There are also loans that adjust every month and every 6 months.
Its actually a really bad idea to get a 30 fixed rigth now unless you have very excellent credit and owe close to only half of what your home is worth. Most people don't stay in a home for more than 3 years, so why should you pay a higher rate and payment to get a 30yr program that you won't use.
2007-02-18 11:53:14 · answer #1 · answered by HBSL621 3 · 1⤊ 0⤋
These are loans that have fixed interest rates for a period of time, and then are adjustable for the rest of the loan. Your examples are a loan fixed for 10 years before adjusting and then one for 5 years before adjusting. Because you are getting an adjustable loan, lenders give you a lower interest rate than the normal 30 year fixed loan. If you are not planning on being in the house for longer than the time the interest is fixed, then these are great options.
2007-02-18 19:29:34 · answer #2 · answered by Ron B 3 · 1⤊ 0⤋
go into a 30 yr fixed. the market is too unstable to go into a adjistalbe.
a 10/1- is a mortgage ragte locked for 10 years but payments spread over 30 years. On the 11th year it will adjust to current market conditions.
Same the for a 5/1 where the rate is locked for 5 years
2007-02-18 19:49:16 · answer #3 · answered by Anonymous · 0⤊ 3⤋