Thursday, August 04, 2005

Jumbo 5/1 ARM vs. 30 Year Fixed

Here is a graph from Bankrate.com showing the interest rates on a 5/1 ARM Jumbo Loan vs. a 30 year fixed loan (for loans originating in California):


Notice how the difference in interest rates is narrowing. Hopefully, the allure of these Adjustable Rate mortgage Loans will wane.
Posted by David at 1:26 PM

3 comments:

  1. AnonymousAugust 04, 2005 12:29 PM

    Higher rate is not necessary to burst the bubble. However, I do welcome more rate hikes.

    I thought 5/1 ARM is passe. Everybody is using Option ARM now.

    ReplyDelete
  2. DavidAugust 04, 2005 12:59 PM

    I agree 100% that 'Higher rate is not necessary to burst the bubble.'

    Higher rates make a housing bubble pop more likely sooner.

    ReplyDelete
  3. AnonymousAugust 04, 2005 5:20 PM

    I know this is a it off topic but none of the blogs have mention the reintroduction of the 30 year T-bill. While this wasn't a secret it does spell that the goverment want to finance its hugh war debt with the longer term. I truly beliveve that they ressurected this bond to drag the 10 year out of it's "conundrum" position. I also believe that this is a calculated effort to deflate the bubble and maybe encourage savings. I have read other blogs that state that savings by US citizens would only add to a "world Glut " of savings. I disagree.. China, Japan etc have excess $$$ because of our excess consumption for there cheap products...I think we our priming our economy for a correction that few can remember..ie 1980's type of recession.. 30 % percent of the population simply can't remember this type of economic downturn...

    John

    ReplyDelete

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