Adjustable Rate Mortgages / The Bottom Line

ARM loans are quite well understood these days. So the general problem of misinformation that existed in the early days is pretty much cleared up. Still, if you have a question, keep asking until you have an answer that you understand.

The old “upside down” problems have been removed from most forms of ARM mortgages. Remember, the clarifying feature of an ARM is that it has moving parts, so don’t assume. Always ask, “Can I get upside down with this loan?” The answer will be only one word: yes or no.

Finally, be sure to ask about the pre-payment feature of the ARM you are considering. You may see various pre-payment provisions and options. Discuss these with your mortgage broker and make a decision suitable to your circumstance.

By Jay Best