When shopping for a mortgage, it’s wise to consider all of your options. By understanding your borrower profile and long-term plans, you can make the decision that’s best for you and your family. One thing to know if you’re in the market: right now, there is a substantial difference in rates between Fixed Rate and Adjustable Rate Mortgages (ARMs). That makes this a wise time to consider just what makes ARMs a smart option for certain borrowers.
1. Low Rates = Big Potential Savings
ARM rates are currently up to 1.5% lower than fixed mortgages. With that big of a difference, that can translate to serious savings over the life of your loan.
2. Increases Are Capped at 2%
At Manasquan Savings Bank, we cap rate increases to 2% per adjustment period – which means you’ll never face more of a rate increase than you can handle. So on our 5/5 ARMs, that means no increase until the fifth year, and then five more years until the next.
3. Divert Savings to Higher-Yield Investments
By locking in rates lower than a fixed-rate mortgage, you can potentially divert those savings into another investment vehicle and grow your money.
4. A Great Choice for Downsizers
If you are looking to downsize, or only plan to be in your property for 7-10 years, an adjustable rate mortgage is that much more likely to pay off.
5. Available for Second Homes
Unlike some other lenders, Manasquan Savings Bank is happy to work with you to finance your second home or to refinance the one you have.
6. Switch to Fixed Anytime
For the foreseeable future, the rate outlook remains favorable for ARM borrowers. However, should the market shift and take rates along for the ride, you can always refi and lock in a comfortable rate.
We’re Committed to Local Lending
At Manasquan Savings Bank, we take time to get to know our customers personally, and work with you one-on-one to survey all of your options before you apply. And with new lending rules in place as of January 2014, that level of personal guidance has never been so important. It’s all part of our mission as a community bank to helping our neighbors get ahead, one person at a time.
Learn more about your mortgage options: Click here