I was on www.Activerain.com (another blogging site) this morning and read a blog from a mortgage person recommending or promoting adjustable rate mortgages. He was partially right in some aspects. Yes some adjustable rate mortgages rates are better than a 30 year fixed rate right now. Yes you can save money. Yes if your plans are to move in 3 or 5 years it may be a good alternative.
HOWEVER, ADJUSTABLE RATE MORTGAGES HAVE GOTTEN MANY PEOPLE IN TROUBLE. You have to look at the down side that is possible. Not just at how much you are going to save. You have to think what happens if I can't refinance later on because the rates have gone up. Or you can't refinance because the home value has gone down. ( like right now)
I am an old school person. I believe you should be trying to pay off your mortgage, not have a mortgage when you retire. I believe more in a 30 year fixed mortgage, though there are cases when a Adjustable rate mortgage is okay. An adjustable rate mortgage is okay if you plan on selling before the rate adjusts. But for me to promote them as a great way to no. No way, no how.
For more on Michigan mortgages, Michigan real estate, and Michigan things to do
go to www.russravary.com
Have a great day. Russ Ravary
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