Updated over 7 years ago on . Most recent reply
Looking to buy first house
Hey guys,
I am looking to purchase my first property. I live in Northwest Indiana but will be purchasing in Illinois. I will be using a VA loan and just needed advice about how to proceed. I am a disabled vet as well so I will be exempt from the VA funding fee as well as property taxes in Illinois. This is mainly the reason for the move, I was initially looking to stay in NWI but our market has heated up and I feel like I'd be paying alot more for less at this point.
My question pertains to the loan itself. The rate that I've been projected is 4.375 for 30 years. I was looking at VA 5/1 ARMS and saw the rates were at least 1 point better if not more. I am considering going the 5/1 ARM route and put the savings from taxes and the lower payment towards the principle of the home. What are some things to look out for with ARMS? I understand the rate rises after the five year period, but my question would be is that If I would be acquiring equity at that pace couldn't I just refinance once the 5 year period end approached. Is this approach that I'm considering a bad idea?
I generally want to use this as form of house hacking to either acquire and hold property, or target decent properties that are dated and fix and sell while living in them.