Mortgage Advice

I was just reviewing rates for my referral partners for this weekend, and noticed that the 3 year ARM is 3.875% with 1 point. That's right, below 4%! The 30 year fixed is at 5% with 1 point, so that is a pretty good spread. On a $200000 loan, that is a difference of $133/month, which is about $1600/year, and $4800 over the three year fixed period.

If you are not squeamish about what might happen in 3 years, the ARM is certainly worth looking at. I know you are going to say the ARMs are what got us into the current mess, but not entirely true, because there is no prepayment on this product and the margins aren't crazy. If you are buying a home, this product would give you more buying power.

Just a thought I wanted to throw out there.