Be wary of arms. You never know what the market is going to be like in 2 weeks, let alone several years. Less than 1/2 point spread between ARM and fixed, not much incentive to go with the arm. 6.25 sounds about right. Don't forget. You'll most likely be itemizing for tax purposes. home mortgage interest (on a primary residence) is tax deductible. Depending on what tax bracket you're in and how much you need to finance the difference between the 5.8% ARM and 6.25% fixed might very well be immaterial. To me, the potential risk isn't commensurate with the limited return, but that's just one man's opinion.
I wouldn't look at ARMs unless there was close to one point difference, and even then I would have to think hard about it. It's a roll of the dice.
Message Edited by maddog on
05-06-2008 03:29 PM
