The mortgage industry has a lot to offer in terms of financing options, special programs for first time buyers and down payment assistance. But borrowers are often confused when it comes to choosing the right mortgage for their needs.
There are financial tools using which borrowers can calculate and compare payments before deciding to opt for a loan program. Even then, they fail to figure out which is the right offer for them. Often they are lured by the low initial rate charged by an ARM and then when it resets, they're simply not prepared to cope up with rising payments. That's when they decide to refinance again to an ARM or most often to a long term FRM.
What I find is, most people can hardly decide between an FRM and an ARM. They are confused as to whether they'll go for 30 year fixed rate mortgage or opt for a 5/1 year ARM. To help borrowers decide between an FRM and ARM, Rick Pelleriti, our community member and a mortgage planner and real estate broker, has come up with a white paper consisting of simple calculations on which is better – taking a 30 year FRM or a 5/1 year ARM and then refinancing it almost 6 times.
Have a look at the white paper and you'll come to know simple calculations that can make a difference in your decision and hence give you financial peace and happiness.
[tags]30 year frm, 5 year arm, frm vs arm[/tags]