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Use an Online Mortgage Calculator to Understand ARMs
from: Mortage & Debt FactsAdjustable rate mortgages still exist, even with the bad rap they’ve received from the mortgage crisis. They are a specialty product that were not meant to be used by everyone, just by a few people who might benefit from the adjustable rate. People who weren’t planning on spending more than five year’s in their home or people who had income that was rising were the traditional buyers of ARM loans. The reasons for this are that the loans adjustable terms are difficult to assess unless you have done your research with an online mortgage calculator. If you don’t know what you are signing with an ARM loan, you shouldn’t get this type of loan.
Get the Facts
There isn’t just one type of adjustable rate mortgage, so you will need to understand the product you are investigating before you plug any numbers into a mortgage calculator. You will need to know how long the initial payment is fixed and when and how often the rate is adjusted. For instance, in a 3/1 adjustable rate mortgage, you might have a period of three years and then it adjusts every year thereafter. There are also 5/1, 7/1, and 10/1 ARMs. There are also hybrid mortgages and ARMs that are tied to different indexes. This can make understanding the product you have a bit more complex. Try to get a good idea whether you are dealing with a classic ARM or whether this is a hybrid product. Also, make sure you know how long the initial rate lasts as some offer teaser interest rates that quickly fly by, some in less than a year.
You will also want to know if the adjustments are capped, so that they cannot go past a certain amount. This is very important to be able to see your best and worst case scenarios with a mortgage calculator. The caps are usually set as a percentage of the previous payment amount or sometimes as an interest rate hike cap. The thing to understand is that even though the interest rate increase may be capped the first year, and nothing happens to adjust the rate the following year, you may still be charged an increase from the previous year’s cap. It’s because the lender assumes you owe and they cut you a break on the previous year. This means that you won’t really be able to figure out exactly what you owe each year on the mortgage calculator, but you can get a best case and worst case scenario from the mortgage calculator.
Mortgage Application Specific links
Mortgage Application News
Mortgage applications up on refi demand: MBA - Reuters
 Christian Science Monitor | Mortgage applications up on refi demand: MBA Reuters NEW YORK (Reuters) - Applications for home mortgages rose last week, fueled by demand for refinancings as mortgage rates hit fresh record lows, an industry group said on Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of ... MBA Weekly Survey: Refinance Applications Increase Because of Record Low ... Mortgage rates fall, mortgage application volume rises Record Low Mortgage Rates Fuel Third Consecutive Increase In Refinance ... |
Refinance Applications Increase in U.S. for Third Consecutive Week, Driven by ... - World Property Channel
 Eastern Morning Herald | Refinance Applications Increase in U.S. for Third Consecutive Week, Driven by ... World Property Channel According to the Mortgage Bankers Association's (MBA) latest Weekly Mortgage Applications Survey for the week ending May 18, 2012, mortgage applications increased 3.8 percent from one week earlier. The Market Composite Index, a measure of mortgage loan ... Even Lower Interest Rates Keep Refi's Rolling |
Rockland County man charged in mortgage application scheme - Mid-Hudson News
 Mid-Hudson News | Rockland County man charged in mortgage application scheme Mid-Hudson News But, between the time of the loan application and its eventual funding in July 2008, Farkas secretly applied for, and received, another mortgage for $292000 from Florida Capital Bank using the same property as collateral. He is accused of receiving ... |
Mortgage rates hit 4th straight record low - OCRegister
 WRAL.com | Mortgage rates hit 4th straight record low OCRegister APPLICATION NEWS SUMMARY: Mortgage Bankers Association weekly survey indicates loan application volume for the week is virtually unchanged. While the MBA headline points to refinance loan applications increasing for the third consecutive week with a ... BofA Repurchases $330M from Freddie; Delinquencies Down, Sales... |
Mortgage Brain's mortgage app used over 10000 times - Mortgage Strategy
Mortgage Brain's mortgage app used over 10000 times Mortgage Strategy Mortgage Brain's mobile application solution to promote brokers and mortgages products to UK consumers has been accessed and used over 10000 times since its launch. The app, UKmortgages, was launched initially on the iPhone on April 16 and will soon be ... 10000 consumers download Mortgage Brain mobile app |