Adjustable to Fixed

[shalane85]

I was approved for a loan with Opteum mortgage. They are offering me a fixed rate of 5.5% or 4.875% if adjustable. Now I'm terrified of ARMs because of what happened to alot of people. However my loan officer stated to me that if I go with the ARMS and payed my mortgage on time for 12 months at the end of the 12 months my rate would become fixed. Has anyone ever heard of this. It sounds to good to be true. He said he would give it to me in writing. Any advice?

[cat-like-stealth]

It's called a Convertible ARM. I think you can pick or are offered an option for one to five years before it converts from an ARM to a Fixed. And I'm pretty sure there's a fee to do the conversion.

[Watchmann]

Just make sure the product you are being offered has that feature.  If you really want a fixed rate mortgage I'd get it now.  All things considered it will be cheaper to start off with a fixed rate rather than switching just a year later.

[Anonymous]

if you can get a 5.5 fixed - I'd be all over it.

[DallasLoanGuy]

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cat-like-stealth wrote:
It's called a Convertible ARM. I think you can pick or are offered an option for one to five years before it converts from an ARM to a Fixed. And I'm pretty sure there's a fee to do the conversion.

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most likely....

[DallasLoanGuy]

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shalane85 wrote:

I was approved for a loan with Opteum mortgage. They are offering me a fixed rate of 5.5% or 4.875% if adjustable. Now I'm terrified of ARMs because of what happened to alot of people. However my loan officer stated to me that if I go with the ARMS and payed my mortgage on time for 12 months at the end of the 12 months my rate would become fixed. Has anyone ever heard of this. It sounds to good to be true. He said he would give it to me in writing. Any advice?

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how many point do they want for the 5.5%

?!?!?!