1 year Libor ARM question (insurance, loan, interest rate, 2013)
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Does that 1471 / 1507 include taxes, insurance and HOA dues, or is it just your P+I ?
If it's the former, then yeah, you're better off. But if it's the latter, after factoring in things like maintenance and depreciation, your renting neighbor could potentially come out ahead.
I have had my 5 year arm based on the one year Libor for 7 years now. Up side is after the the 5 years is almost 50% of my payment go's to the principle. Before you think about refinancing, do the math. The Libor will have to go up huge to offset the difference in dollars going to the princple. Keep your credit perfect and this is a great mortgage to have. you pay down the home faster and when the Libor go's up, which looks like it will be a while before we see a huge spike, then refinance.
I have had my 5 year arm based on the one year Libor for 7 years now. Up side is after the the 5 years is almost 50% of my payment go's to the principle. Before you think about refinancing, do the math. The Libor will have to go up huge to offset the difference in dollars going to the princple. Keep your credit perfect and this is a great mortgage to have. you pay down the home faster and when the Libor go's up, which looks like it will be a while before we see a huge spike, then refinance.
Yep. For almost the past 4 years with 1 year libor or treasure rates being close to zero.
Those who had ARMs resetting have actually seen their payments go down based on interest rates being very low.
Why doesn't congress or the media report this? And I doubt short term rates are going up for another 2 years. So these people with arms would have had significantly less interest rates for 4-6 years ongoing.
Of course it's a ticking time bomb if people cannot handle the potentially 2-5 percent bump in rates once interest rates do come back up.
Arms are great IF you understand the maximum rate you can handle.
Even interest only arms are great for certain people (people with significant assets or income to cover any potential losses....so interest only probably would be beneficial for someone in the top 5% in terms of assets).
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