ARM loans - An Alternative

Steve and I just closed escrow on a home in Dana Point. We bought a condo-- due to location and view—and the amenities it affords us.

I don’t usually recommend condos, due to the control you hand over the HOA on a variety of issues. Then again, an HOA that is well-structured and managed can take a lot of headaches off the homeowner! We’ve just completed painting and are in process of installing new flooring (www.macflooringservices.com) before we move in this weekend. It has been quite an adventure so far!

Why am I telling you this? We selected a 5-year arm. Here's why...

Most of my clients prefer 30- or 15-year fixed rate financing, due to the opportunity to lock-in record low rates that will be fixed for the life of the loan. But as I always tell everyone, you need to consider the whole financial picture when selecting the loan program that is right for you. It all depends on how long you intend to remain in the home, as well as other factors.

In our case, we decided on a five-year ARM with a slightly lower rate than the fixed rate programs (that are still low!) as this better suits us.

So while 30- and 15-year fixed rate loans will remain the preferred financing approach for most people, don’t rule an ARM or even interest-only financing, if there is a reason this type of loan might better fit your personal financial needs.

Here's a photo of the before picture with yellow paint and brown carpet. Updates to follow!~