Posted on: 09th Jun, 2004 01:28 am
Hybrid Mortgage is a type of Mortgage, which combines the features of both fixed and adjustable rate mortgage. It is also known as a 'two step mortgage' and 'alternative mortgage products'. It is a special type of 7/23 mortgage and 5/25 mortgage, which has one time rate adjustment after 5 or 7 years.
Features of hybrid mortgage are as following:
Features of hybrid mortgage are as following:
- It is a special type of adjustable rate mortgage.
- The loan will start from a fixed rate of interest at certain length of time,
and then later it will convert to an adjustable rate mortgage.
- There is no additional refinancing cost, no forms to complete, and no re-qualification necessary for making adjustments in interest rates.
- It adjusts only once, either at 5 years or 7 years.
I own 39,000 an want to take additional 40,000 for home improvements. My mortgage is done in 3 years. Should I take an 5/1 ARM for 80,000 and can I pay off the balance on the mortgage with that. I plan on paying it all off in 5 years before the rate can increase. Is this a wise choise.
Hi candlegal,
In my opinion, the option that you've mentioned is a good one. You can take out a 5/1 ARM and pay off the balance loan with it and also improve the property. Then, if you've the required money, you can pay off the mortgage in full within the next 5 years.
Thanks,
Jerry
In my opinion, the option that you've mentioned is a good one. You can take out a 5/1 ARM and pay off the balance loan with it and also improve the property. Then, if you've the required money, you can pay off the mortgage in full within the next 5 years.
Thanks,
Jerry
I will have a balance on my loan from the lender of 120,000. I plan on paying that balance off in 3 to 5 years. I have never worked with ARM at all in my life. Would a 3/1 or a 5/1 be the best with out getting into a whole lot of trouble?
Hi Mike,
As you're planning to pay off the loan within the next 3-5 years, I guess it will be safer if you go for 5/1 ARM. But then, I personally believe that it is a better option if you go for a fixed rate mortgage.
Thanks
As you're planning to pay off the loan within the next 3-5 years, I guess it will be safer if you go for 5/1 ARM. But then, I personally believe that it is a better option if you go for a fixed rate mortgage.
Thanks