I am looking to sell my house get a larger one for a now larger family.
2007-12-16 09:05:29 · 6 answers · asked by Eva G 1 in Business & Finance ➔ Renting & Real Estate
The feds have not frozen ARM rates. If Congress does pass such a bill it would not help you for future purchase.
ARM's have always been safe. Mortgage products are simply tools to help get one to their goal. Like a razor blade, if you use one incorrectly, it can and will cut you.
2007-12-16 09:25:39 · answer #1 · answered by Anonymous · 0⤊ 0⤋
ARMs are not inherently unsafe but they were used in ways that led people into financial problems. With an ARM, the mortgage rate will adjust in a certain period of time -- usually one year, five years or seven years. A lot of people could afford only the introductory rate, and either didn't understand the amount the rate would rise after that, were tricked by unscrupulous lenders, or thought they would be in a better financial position. When the rates rose, they could not afford the new payment. Other people thought they would be able to refinance when the rates ajdusted, and can't
I just got a new mortgage, and the 30 year fixed rates were not significantly higher than the ARMs. Make sure you understand the terms of the loan. Make sure you can pre-pay it (pay it off early or refinance) without penalty. Don't buy more house than you can afford. If at all possible, put 20% down, so you won't have to pay private mortgage insurance.
Talk to a reputable bank or credit union. Not all mortgage lenders are bad, but there are many who are in it for the money and don't give a flip about the borrower. If you are not knowledgeable it can be hard to know that they don't have your best interests in mind.
2007-12-16 09:25:41 · answer #2 · answered by Anonymous · 1⤊ 0⤋
I would stay away from ARMs in this market!
There are some really great fixed rate loan products out there. You're much safe doing that!
If you want to tell me what state you're in, I might be able to provide you with the name of a reputable lender or broker.
2007-12-16 10:53:44 · answer #3 · answered by Anonymous · 0⤊ 0⤋
The agreement to freeze rates on ARM mortgages does not apply to new loans yet not in existence. The agreement applies only to specific ARM's issued during a certain time period.
2007-12-16 09:54:01 · answer #4 · answered by acermill 7 · 0⤊ 0⤋
No. Those changes only impact existing loans, and actually not really that many, and only for a temporary period of time.
With some real concerns about inflation, and low fixed rates, most experts would advise a fixed rate loan.
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2007-12-16 09:21:20 · answer #5 · answered by Gatsby216 7 · 0⤊ 0⤋
Where can I find out about this new law and if it applies to me?
2007-12-16 11:10:04 · answer #6 · answered by ricoscoro 1 · 0⤊ 0⤋