arm mortgage explained
my arm on my mortgage just reset?
It was 8.69 and it reset at 11.69 I didn’t think it would go up that much since the feds lowered the interest rates. I guess I was wrong. Can anybody explain how all this actually works?
depends on what ur rate is tied to, there are different market indexes and then there is a margin over the index rate increase, you need to read your mortgage note, and then look up the index on the web, sounds like u might have what is called a libor, london index and a margin increase, most arms are limited in the mortgage note how much they can increase each adjustment period and most are 2% urs went up 3% which is high but not out of the question, when u find the index and the margin increase also look for the adjustment period, some of them went from 6 mths, 1yr , 2yr, 3yr, for the first and then adjust every 6 months after that, and do not have the same adjustment periods each time but drop to every six months. u will find this info in your mortgage note also. THIS SHOULD HAVE BEEN EXPLAINED TO YOU BY YOUR MORTGAGE OFFICER BUT I BET IT WASNT, also look for the maximum amount it can go to most were pegged at 6% over the starting rate which means it could go as high as 14.69. due to the fact that it sounds like ur rate is tied to a foreign market index and most of them are nothing the FED does is going to matter to your note, BET THIS WASNT EXPLAINED TO YOU EITHER, SORRY NEXT TIME GO TO THE LOCAL BANK AND NOT A BROKER.
Mortgage Mess – Adjustable Rate Mortgages
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