Should Your Refinance and Get Rid of Your ... - Boise Real Estate

Do you have an Adjustable Rate Mortgage (ARM)? Then you may be considering refinancing your mortgage in order to dump your ARM. This is something that many mortgage companies and real estate professionals have been stating as a good option for quite some time now. So do you think it?s time for you to refinance your ARM?

What are the disadvantages of an ARM?

If you have an Adjustable Rate Mortgage (ARM) on your property, you may have decided to do this to take advantage of the low rates at the time.? Additionally, many consumers took advantage of the ARM because they thought they would not be in the property long and would be out of it before the ARM expired or adjusted and the interest rate increased.? However, that is the true disadvantage of the ARM ? the interest rate balloons at specific intervals throughout the term associated with the ARM therefore making it difficult for consumers to make their loan payments. That is why most financial experts will suggest that it is a good idea to get out of an ARM before the balloon payment.

Should you Refinance Now?

Interest rates on fixed-rate mortgages remain low. If you think you will still be in your home by the time the balloon payment hits, it may be in your best interest to refinance. However, if you plan to get out soon, sell your property and lose the loan, before the end of the ARM term, you may want to keep it because you probably still have a lower interest rate than you can get with a fixed rate mortgage. Many people who relocate frequently or are planning to sell soon are keeping their adjustable rate mortgages because their rates are competitive and it isn?t worth the cost or time to refinance.

So, should you refinance your adjustable rate mortgage (ARM)? It is truly up to your individual situation. Only you know if it?s the best move for you. Ask for advice from experts and determine whether the timing is best for you to stay with your ARM or refinance to a low, fixed rate mortgage.

Source: http://www.randygridley.com/should-your-refinance-and-get-rid-of-your-adjustable-rate-mortgage/

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