Should You Get An ARM?
A LIBOR ARM may be for you if you l are looking to minimize your monthly payment and save more towards the principal balance. Seeking a lower interest rate will increase your monthly cash flow and you will want to take advantage of the equity in your house.
How much can you save towards principal in 5 to 10 Years? If you have kids there is a high probability you will need to refinance your awesome 30 year fixed rate to take cash out and pay for the kids college.
l ARM interest levels are significantly below fixed-rate interest charges l You won’t be staying in the house for more than five years (especially if you have a locked-in rate for the first three, five or seven years)l You anticipate a higher income in the future. ARMs are not a good idea if l initial rates are comparable to fixed-rate loan rates l high closing costs offset the low interest rate