Hybrid ARM refinance vs VA fixed rate loan

More info is needed.. But in general, FHA & VA rates right now are 3.25% for fixed rate mortgages.. Lower if you go 15 years.. so for that .25% lower rate just doesn't make sense to go with an ARM.. However the ARMS that are offered today through FHA and VA, are very safe and they are ideal if they are used for what they were intended for... The ARMS of the mid 2000's were the problem child's, and are now outlawed.. Any conventional, conforming financing you get today will have no form of pre-payment penalties.. so you can pay it off anytime you like.... I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

We would need more information on your file to accurately advise you as to whether it makes sense or not. The most important thing is to make sure you know exactly what the terms and conditions are on the ARM product. How long is it fixed for, what index is being used and what is the margin. If you get all the facts you can make an informed decision.

The pros and cons are pretty simple....you are getting a lower rate today in exchange for taking some interest rate risk in the future. If the ARM you are looking at gives you a fixed rate for 7 years and you KNOW you will be able to pay the loan off in that same 7 year term, you are all but eliminating the future interest rate risk you are taking. However, as my colleague has indicated, you shold be INTIMATLEY familiar with ALL of the terms of the ARM you are taking so you are not surprised at the end of the 7 year term if you haven't paid the loan off as planned.

Hello there- I am here locally if you want to speak to someone further about it. My website is SALending.com and my office number is 491-2502. Thank you

Good luck dbatt5!

It looks like you have made a smart decision. With today's low interest rates you can lock in a low fixed rate, that will remain constant until you pay off the loan. With an ARM you are taking a risk if rates go up in the future, you could end up paying a lot more than with a fixed-rate loan.