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Updated about 7 years ago on . Most recent reply

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Ryan Moore
  • Rental Property Investor
  • Phoenix, AZ
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7 year fixed w/ 15-30 amortization

Ryan Moore
  • Rental Property Investor
  • Phoenix, AZ
Posted

Dumb question, but when a lender says 7 year fixed w/ 15-30 year amortization, that's just an ARM correct?

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Stephanie P.
#5 Mortgage Brokers & Lenders Contributor
  • Washington, DC Mortgage Lender/Broker
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Stephanie P.
#5 Mortgage Brokers & Lenders Contributor
  • Washington, DC Mortgage Lender/Broker
Replied
Originally posted by @Ryan Moore:

Dumb question, but when a lender says 7 year fixed w/ 15-30 year amortization, that's just an ARM correct?

Not a dumb question and the answer is yes, it'a an ARM. Not sure what the 15-30 piece is because usually a 7 year ARM has a 30 year amortization, not 15.

  • Find out what the ARM is tied to (T Bill, LIBOR etc...)
  • Check the index's volatility with charts online
  • Figure out what the rate will adjust to in 7 years.
  • Decide whether you're going to have the property 7 years from now
  • Would a shorter term ARM suit you better or would a 30 year fixed work better
  • What's the prepayment penalty and for how long

Just a few things to find out

Best of luck

Stephanie

  • Stephanie P.
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