Adjustable Rate Mortgage vs Fixed

[Tyler Hubarth]

What are you thoughts on adjustable vs fixed rate mortgages? Should I be afraid of doing anything with an adjustable rate? 

[Russell Brazil]

Over the last decade an ARM has been great since we have been in a falling interest rate environment. If we enter a rising interest rate environment (Which we have to at some point right?) then you will probably wish you had a fixed rate. However I dont think they are scary. I have an ARM on one of my properties and fixed rates on all the others. I just know that I have a ticking clock on that one property....but even though the rate will reset...I think it can only reset a maximum of 2% a year with a maximum of 8% overall. Thats still 6 years in the future before I hit my first adjustment period, and Im sure in that time my rents will likely grow more than the amount of the adjustment.

With rates the way they are now, and the overtures of an increase we have been getting from the Fed, I see little reason to not go with a fixed rate if it is an option for you.