Seems some folks just don't learn...

[Capt Worley PE]

After hovering around record lows for the past few years, mortgage rates are rising dramatically. That has consumers not only shopping more but also considering adjustable rate mortgages, which offer lower rates and lower monthly payments.

These ARMs, many requiring interest payments only, were popular during the latest housing boom but quickly fell out of favor when safer, fixed-rate loan rates fell to record lows. ARMs accounted for 36 percent of mortgages in 2006 but just 4.5 percent today, according to Lender Processing Services.

The shift to ARMs is not visible on a grand scale yet, but it is beginning.

http://classic.cnbc.com/id/100845777

 

[Dexman PE PMP]

Why are people freaking out about these "high" interest rates. Rates are forcasted at the 4-4.5% range, which are still historically very low.

 

[MGX]

We just bought a house at 3.5%. The bank wanted us to do an ARM (great deal for them and bad deal for us) but we cranked them up until they backed off the idea and gave us a conventional.

 

[mudpuppy]

One of my coworkers has been house shopping. In the 6 weeks he's been looking rates have gone up 1.2%. That's an incredibly fast rise, and that shaves about 15% off how much home they can afford for the same payment. 15% decline in buying power--that's why people are freaking out, even though rates are still tremendously low.

As for ARMs, now is the exact worst time to get one!

 

[Flyer_PE]

I did an ARM for my second house. Interest rates were tracking lower I converted it to a conventional at a 1% lower rate about a year later. Wouldn't touch one in today's environment though.

 

[YMZ PE]

^ Like a boss.

 

[Ble_PE]

I'm just glad we refi'd at the end of last year. We ended up getting a 20 year mortgage with a 3.375% rate. We pay pretty much the same monthly payment we were paying but will save about $100k in interest over the life of the loan (assuming we stay here the whole time).

 

[mevans154]

I refinanced in 2011 with a 7/1 ARM loan @ 2.24%. I have been paying down the principle like crazy.

I have 5 payments left!

This November I will be mortgage free at 45 years old!!!!

Party Time!!!

 

[Master slacker]

I'm just glad we refi'd at the end of last year. We ended up getting a 20 year mortgage with a 3.375% rate. We pay pretty much the same monthly payment we were paying but will save about $100k in interest over the life of the loan (assuming we stay here the whole time).

We got a 15-year at 3.875% and hope to have it paid off before we move... if / when we do. At the very least, I want that bitch down so low that a move to a 6+% mortgage is mere pocket change.

 

[roadwreck]

We are buying a house and from the time I started shopping around rates went from 3.75% to 4.125%. It was annoying, because I would have been better off just locking in with the first person I called and it would have been cheaper. Shopping around did nothing but cost me money, solely because rates just kept climbing. I guess I shouldn't complain to much, looks like rates have gone up to 4.5% since I locked in. Still very low, but as mentioned before it does sap buying power.

 

[Road Guy]

For folks buying a house or refinancing are they still trying to get PMI for 15 year loans?

I've got 9 years and counting left on my mortgage.. Makes me feel old but that would put me at the house paid off when I am 48.. Also I'll have 2 kids out of high school then and I don't know what circus training cost these days so it will be nice not to have that anymore... Unless I get a job out west and move then I am gonna get a 30 year mortgage and say "what the fuck..."

 

[Capt Worley PE]

I've got 9 years and counting left on my mortgage.. Makes me feel old but that would put me at the house paid off when I am 48..

Bah...I'm 47 and have fifteen years left.

 

[mudpuppy]

I've got 4 years left on my mortgage, but I'll be moving before then and pretty much starting over since my house is worth less than many cars. Assuming I can sell it.

 

[Krakosky]

^ time for the marriage house?

 

[mudpuppy]

Perhaps.

When are you getting yours?

 

[Dexman PE PMP]

Assuming I can sell it.

I know some guys would would possibly be interested in using it as an investment property...

 

[mudpuppy]

^I'll get you in the loop when the time comes. I have heard there are a lot of investment people snapping up houses as they come on the market or before. If I could do an FSBO it could be a win/win. My dad has done that a couple times. A little bit of leg work, but it's a lot less expensive than a Realtor.

 

[Dexman PE PMP]

They prefer something more along the lines of an Owner financed property so they're not messing around with banks/realtors at all. You would essentially serve as the bank and could charge interest, so you end up with more $, and they don't have to worry about credit and banking requirements.

Plus, if it works out, I get to charge them a "finder's fee"...

 

[mudpuppy]

Ah. . . that's a problem because I need cash up front to buy my next house.

 

[Dexman PE PMP]

I said its preferred, but by no means is it a deal breaker