FHLB V LIBOR rates? PROS/CONS

[Yaya Y.]

I would like to know everyone's opinions on the scenario below.

You want to get a mortgage for 650k,  one bank quotes you with an interest rate of x basis points over the FHLB 5 year rate, and the other bank's rate is the same spread over a 5 year LIBOR swap. Which option is preferable for the borrower? What are the pros and cons of LIBOR and FHLB and which rate is more susceptible to future increases?

[David Gonzalez]

I would worry more about the deal and the terms of the loan. But if I had to choose I would choose FHLB. Since LIBOR is an international index I would choose FHLB rate since it would most likely match Americas Macroeconomic Policy/Condition.