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How long do you plan to live there? Posted by Bill Homer [Email] (#3427) [Profile/Gallery] (more from Bill Homer) on Thu, 26 Jan 2012 10:56:12 In Reply to: Mortgage Advice, SS, Thu, 26 Jan 2012 10:01:03 Members do not see ads below this line. - Help Keep This Site Online - Signup |
I know that this is a difficult question, but sometimes you have a fairly good idea of your lifestyle direction. In three years, our kid will be away at college and we see little use for a house as large as the one we are currently in - hopefully, the market will have recovered somewhat and selling a house in the next five to seven years will be easier. Also I seem to recall that the average stay for owners of houses in the US is something like five years (unbelievable to someone whose parents are still in their house 50+ years later), which also points to a shorter-term strategy.
With these facts in mind, when I refinanced a year ago I opted for an Adjustable Rate Mortgage (ARM), fixed for five years at 2.75%, capped thereafter - and NO CLOSING COSTS other than an appraisal fee (caveat: they require that I keep a property tax and insurance escrow). Fixed rate 15s and 30s were sufficiently higher at the time that I will be ahead for 7+ years even if the rates went up the maximum. I have a mortgage broker that I have used several times who found this deal for me; the mortgage holder is a bank that I never heard of, but I really don't care.
There are a lot of variables, and "one size does not fit all" - you need to give us more info.
posted by 108.71.134...
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