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Real Estate Tips
Financing Your Home >More On ARMs

Lenders are always looking for new ways to help buyers get into the home of their dreams. Today they frequently use adjustable rate mortgages (ARMs) to increase the buyer's options. The interest rate on an ARM changes periodically to reflect changes in the national market. Since the loan starts at a rate that is lower than the national average, lenders can reduce the borrower's qualifying criteria.

One way to distinguish between different ARMs is by the national index to which they are tied. Some ARMs are tied to a slow-moving index called the cost-of-funds index; these are usually the most desirable. ARMs that are tied to a more volatile index, such as Treasury Notes, can be adjusted upward at a quicker rate. Look at all the factors before choosing a loan. The faster index loan may start out with lower rates and lower monthly payments, but the slower index ARM may eliminate your concern about having to re-finance down the road.

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Real Estate Trivia
Q 
Over what famous building is aircraft forbidden to fly at any time?

A 
No aircraft is permitted to fly over the Taj Mahal in India.
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Ginny Anderson, REALTOR®, real estate agent and broker for Orangeville, Mono and Amaranth, Ontario home listings, property and land for sale - NUMBER1EXPERT(tm)

Ginny Anderson
Royal LePage RCR Realty

14 - 75 First Street
Orangeville, ON L9W 2E7
519-941-5151
Fax: 519-941-5432
905-450-3355
ginnyanderson@NUMBER1EXPERT.com


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