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Should I lock in my mortgage interest rate?
chase bank offer to lock in my interest rate for 5 years fixed at the current rate. They send me a letter to sign and mail back. They said my interest rate is scheduled to adjust every 6 months starting on Dec, 1 2008. Should I do it? Thanks
6 Answers
- 1 decade agoFavorite Answer
I would lock it in. Hopefully they aren't screwing you on the rate itself. If you don't lock it in plan on your rate increasing x 3 every six months for the next 3 to 5 years. It is going to take at least this long before the housing market turns around.
This is one of the issues that lead to the housing market disaster. ARM loans were great until the interest rates increased above homeowners ability to pay. There are a lot of people who have lost their homes because of this alone. Thank God my rate was locked in from the word go.
- 5 years ago
To be totally honest, 2.75 points is high for that rate. There are a lot of factors that determine your interest rate, but a standard 30 year fixed rate with 20% down, good credit, primary residence, and full income documentation is currently priced at 6% costing 1.375% on a 45 day lock. You should be able to get 5.875% or so if you're paying that much. As far as locking goes, the market is extremely volatile right now - I would recommend locking; but there's no way to tell for sure what the market will do.
- Anonymous1 decade ago
it sounds like they are offering you a loan modification? Unless you are able to refinance into a fixed rate loan, I would take what they are offering (its cheaper than a refi!)
Source(s): I'm a mortgage banker - golferwhoworksLv 71 decade ago
either that or refinance now to a fixed note.
I am a mortgage banker in TN & KY