Mortgages

I know someone who is facing an adjustment with their ARM mortgage. Their monthly payment will increase but not as much as it could have if the Feds had not made their interest cuts earlier this year.

My friend decided on this adjustable rate rather than locking in at 5%. This person is too young to remember rates 23 and 24 years ago.

5% beats the new car loan we looked into in March. 5% beats the 13% mortgage we would have had 23 years ago if we had not "bought down" to 9.75%. Seriously, 5% beats most of the mortgage rates over the past 60 years.

I am amazed that with rates at 5% mortgage companies felt the need for creative financing. My friend went to refinance from their 6.5% mortgage and bought into the ARM craze of a few years ago. I hope they will lock into a rate this time.

'til later