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- January 06, 2011, 07:29:12 AMAbout the author:
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Finance Article: Have you considered a hybrid adjustable mortgage?
A hybrid ARM is one where the rate is locked in for the first
few years of the loan and then will go back to market rate at
the end of the lock-in period. The lock in period is quoted up
front and written into the adjustable rate mortgage contract.
This period can vary from five years on up. Depending on your
credit history, the amount of the loan, and your experience with
your mortgage lender,You are not allowed to view links. Register or Login, you can negotiate lock in term as high as
eight or eleven years.
If you were to get a fixed 30-year mortgage at the same that
you’re considering the hybrid, it is unlikely that you would get
a fixed rate that matches the teaser rate on the ARMs in the
market. To take full advantage of this type of mortgage, you
must fully understand that the rate will revert to the ARM
levels at some point.
This means that you can count on a rapid and drastic increase in
your monthly payment once the loan goes back to a full
adjustable rate basis. If you plan to stay in the home for a
very long time, your savings from the locked in period will
probably be wiped out when the loan reverts to its adjustable
status. You can consider a refinance, but that will also take
some money out of your pocket. If you decide that you don’t want
to sell the property, keep in mind that overall,You are not allowed to view links. Register or Login, your loan will
still be an excellent choice for your financial situation.
If you’re not sure if you should sign up for an adjustable rate
mortgage (ARM) or a fixed rate mortgage, you’re not alone. It is
very easy to get excited when thinking about your new home, and
then get feel a bit deflated when it is time to start thinking
about financing.
This type of loan is ideal for anyone who plans to stay in their
home for the first few years and then move to another place.
Couples,You are not allowed to view links. Register or Login, young home owners,You are not allowed to view links. Register or Login, first time buyers and anyone who is
upwardly mobile. The average American spends about nine years in
their first home. If you fit into this profile, you can get a
hybrid adjustable rate mortgage, get a fixed rate for the first
five to ten years and then sell the home before the rate starts
to fluctuate again.
Part of the challenge for any home buyer is to reconcile the
fact that the introductory rates on adjustable rate mortgages
can be so low. In fact, they are often lower than the market
rate, and considerably lower than the rates on fixed rate
mortgages. Now, you can get an ARM and some of the benefits of a
fixed rate loan with the hybrid adjustable rate mortgage.
This article may be freely distributed as long as there is an
active link back to You are not allowed to view links. Register or Login
Finance Article: Have you considered a hybrid adjustable mortgage?
A hybrid ARM is one where the rate is locked in for the first
few years of the loan and then will go back to market rate at
the end of the lock-in period. The lock in period is quoted up
front and written into the adjustable rate mortgage contract.
This period can vary from five years on up. Depending on your
credit history, the amount of the loan, and your experience with
your mortgage lender,You are not allowed to view links. Register or Login, you can negotiate lock in term as high as
eight or eleven years.
If you were to get a fixed 30-year mortgage at the same that
you’re considering the hybrid, it is unlikely that you would get
a fixed rate that matches the teaser rate on the ARMs in the
market. To take full advantage of this type of mortgage, you
must fully understand that the rate will revert to the ARM
levels at some point.
This means that you can count on a rapid and drastic increase in
your monthly payment once the loan goes back to a full
adjustable rate basis. If you plan to stay in the home for a
very long time, your savings from the locked in period will
probably be wiped out when the loan reverts to its adjustable
status. You can consider a refinance, but that will also take
some money out of your pocket. If you decide that you don’t want
to sell the property, keep in mind that overall,You are not allowed to view links. Register or Login, your loan will
still be an excellent choice for your financial situation.
If you’re not sure if you should sign up for an adjustable rate
mortgage (ARM) or a fixed rate mortgage, you’re not alone. It is
very easy to get excited when thinking about your new home, and
then get feel a bit deflated when it is time to start thinking
about financing.
This type of loan is ideal for anyone who plans to stay in their
home for the first few years and then move to another place.
Couples,You are not allowed to view links. Register or Login, young home owners,You are not allowed to view links. Register or Login, first time buyers and anyone who is
upwardly mobile. The average American spends about nine years in
their first home. If you fit into this profile, you can get a
hybrid adjustable rate mortgage, get a fixed rate for the first
five to ten years and then sell the home before the rate starts
to fluctuate again.
Part of the challenge for any home buyer is to reconcile the
fact that the introductory rates on adjustable rate mortgages
can be so low. In fact, they are often lower than the market
rate, and considerably lower than the rates on fixed rate
mortgages. Now, you can get an ARM and some of the benefits of a
fixed rate loan with the hybrid adjustable rate mortgage.