Thoughts on 5/1 Arm

[Account Closed]

Primary residence not investment. With rates at 2.875% on a 5/1 thiking of refi from 30yr. where I have 4.625%

What are reasons why or why I shouldn't do this. It would save me $400 a month in payment.

Thanks

[Jon Holdman]

Do you really think rates will be lower in the future? I don't. I think its much, much more likely rates will be higher in the future. So I think its a much better idea to lock in today's low rates into long term loans. If rates are 10% in five years (not at all unlikely, IMHO) your "savings" now may result in your being unable to afford your loan.