Question:

What are the most popular types of adjustable rate mortgages?

Answer:

The most popular types of adjustable rate mortgages are the hybrid ARMs. They can offer you fixed low rate for a short or long term, according to your needs.

For example, a 2/1 adjustable rate mortgage will let you have a choice among many payment options. You will have a great low rate for two years and the option to make either interest-only or minimum payments before your rate begins to adjust yearly. At that time, you could sell the house or refinance, or keep to the 2/1 adjustable rate mortgage type.

In case you want more stability, a 7/1 or a 10/1 ARM will get you a great variety of payment options, plus lower rate compared to an FRM, plus you will have plenty of time to decide what to do with the house when the fixed term expires.

The hybrid types of adjustable rate mortgages apply to jumbo loans, as well. The most exotic mortgage products on the market are based on the hybrid types of adjustable rate mortgages, such as a 10/1 ARM over 50 years.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
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