Refi and Home Finance

A few years ago many of us decided to do what everyone else was doing. We all hopped on the bandwagon and refinance (or simply finance as a purchase) our homes using the almost too good to be true adjustable rate mortgage loans or ARM loans. After all, why wouldn’t we? They got us into lower payments, and we didn’t have to worry about anything like a rate adjustment for a few years. And so we relaxed and patted ourselves on our own backs for being so smart. But now those few years have passed, and the rates are changing!

And this change or adjustment in interest rate can be a little disheartening. Many people are suddenly faced with a higher payment. Some people are afraid that they won’t be able to afford the new higher payment.

Well folks, the sky is not falling in. The good news is that interest rates are still at a historical low point. If you are facing an adjustment that is raising your mortgage payment perhaps the best strategy would be to simply refinance again. Only this time, let’s all learn from what happened a few years ago. This time let’s not even think about going with adjustable rate mortgages!