Adjustable-rate mortgages are making a comeback, but this time it will be different. Financial groups are offering ARM’s. These rates can vary after a few years but can be less expensive, when compared with fixed-rate mortgages.
This will be the focus of borrowers with strong credit who are using ARM’s to take out “jumbo” loans. Profiles of borrowers FICO credit score range in the 762, with purchases of $420,000 to $1 million. These loans are for borrowers who are well-heeled. The average rate on one type of jumbo ARM was 2.91% for the week that ended March 7, or about 1.5 percentage points lower than a 30-year fixed rate.
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