Hi there, I need some quick help.
I managed to get 2 options for mortgage rates-
1) Fixed 25 year for 3.74% for 4 years
OR….
2) variable of 2.45%, 25 years
I know that if the economy gets better, variable might be dangerous. What do you guys suggest?
4 Comment(s)
FIXED!!!
Never go variable unless you want to keep adjusting your mortgage and keep an eye on the interest rates weekly. Each time you adjust, you will have to take out a new mortgage and pay closing costs.
Go for the fixed for 25 years and pay it down. If you can handle a 15 year fixed, do that instead.
Adjustable rate loans are good for short term, but there is risk, and risk should be calculated and minimized. If this is for a home that you will stay in for a while, go the fixed loan route, and worry less.
Not sure why you describe your fixed as fixed for 25 years… for 4 years. Sounds like this could be a short term fixed rate which would not be recommended.
Neither of those deals sound legit, best fixed rate loans are 25 year terms are around 4.75% if you’re paying like 1.5pts. Average is around 5.125%. 5/1ARMs are around 3.75% with 1pt at best. If the price of gas is $2.20 on average around your area and 1 place is advertising .50/gal you know something isnt right. No one is that cheap. Call a few major lenders and they’re verify what I’m telling you.
FIXED!!!
Never go variable unless you want to keep adjusting your mortgage and keep an eye on the interest rates weekly. Each time you adjust, you will have to take out a new mortgage and pay closing costs.
Joscasta | Feb 20, 2010 | Reply
Go for the fixed for 25 years and pay it down. If you can handle a 15 year fixed, do that instead.
Adjustable rate loans are good for short term, but there is risk, and risk should be calculated and minimized. If this is for a home that you will stay in for a while, go the fixed loan route, and worry less.
Not sure why you describe your fixed as fixed for 25 years… for 4 years. Sounds like this could be a short term fixed rate which would not be recommended.
JohnHenry | Feb 22, 2010 | Reply
Neither of those deals sound legit, best fixed rate loans are 25 year terms are around 4.75% if you’re paying like 1.5pts. Average is around 5.125%. 5/1ARMs are around 3.75% with 1pt at best. If the price of gas is $2.20 on average around your area and 1 place is advertising .50/gal you know something isnt right. No one is that cheap. Call a few major lenders and they’re verify what I’m telling you.
Nash P | Feb 23, 2010 | Reply
Fixed. Did they tell you at what rate the fixed rate will cap out at? You need to ask them what the graduated rate increase is and the cap out rate.
REI R | Feb 25, 2010 | Reply