Sometimes it makes sense to refinance into an ARM

Sometimes it makes sense to refinance into an ARM

Low mortgage rates have many homeowners rushing to refinance, and the vast majority of those borrowers opt for fixed-rate home loans. Yet for some homeowners, an adjustable-rate mortgage can be a financially savvy choice.

Nowadays, adjustable-rate mortgages, or ARMs, appeal to two groups of borrowers. The first group consists of homeowners who need jumbo loans, above the conforming loan limit of $417,000 in most markets or $625,500 in high-cost housing markets. Many of these borrowers want to keep their payments as low as possible when they refinance, so they’re attracted to lower-rate ARMs.

The second group comprises homeowners who have firm plans to sell their homes in a few years because of scheduled job transfers or retirement.

Read More on The Seattle Times…

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