Hi,
I’m currently shopping for my first mortgage and am wondering if theres any advantage in doing a 5/1 ARM when fixed rates are so close. My bank quoted me 6.125% on a 5/1 ARM with 3% down and 6% on a 30 yr. fixed with 20% down. I plan on staying in the house for no more than 5 yrs.
I do have funds for 20% down, but wouldn’t mind holding on to a few bucks for safe keeping. Is there a clear advantage to either of these options?
Thanks!
Asked by:akajoe75
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Don’t fk up your future – never, never, never get an ARM. Especially with rates so low. Get the best terms on a traditional mortgage that you can, but don’t ever get an ARM.
@Robert W – when it rains it pours – eh comrade?
Skip the ARM, you could loose everything. What do you think people are crying about?
I say go with the 30. Put 10% down not 20. Even 5% down gets you conforming rates. You can still get 6% with a point. 6.25% with no points. Yes there will be PMI. If that is a concern, ask about a piggyback.
You will sleep better with a 30 and 5 years goes by in a flash!
BTW, What is the loan size?
do not get the ARM….you can get a 6.125% on a 30yr fixed with 5% down. FHA is 3% down…and that’s about 6.625%……another thing is how many points are you paying
Why is your lender asking you to put 20% down on a fixed. There are so many other options out there. You don’t have to put that much down to get a fixed. Especially if you are a first-time homebuyer. I would do somemore research before taking the step that changes your life forever!
Go ahead get the ARM . i’d like to meet u.
(fixed rate only)
If you are certain that you will not outstay the ARM then it is a beter deal, sure.
But it is a gamble. What if something happens and you can’t sell?
Not worth it to me, personally.