Re-FI or Ride out the the ARM?

[Brandon Pearsons]

Currently I live in My principal residence which I plan on turning into a rental within the next year. 

I had a 5/1 ARM that went adjustable 5 years ago. The interested rate has been great! ->Currently the ARM interest rate is 2.8% ( adjustable to up to 2 points every two years. It is based on the libor index) Im loving the principal payment amortization of almost 50%! since I have had the same loan for almost 10 years.

My question is should I refi?????????????????????????????????????????????????

My payment will drop from $875 ( p&I @ 2.8% interest ) per month to $815 ( p&i @ 4.6%)  but my principal payment will drop only 27% since it is a new loan.  

I plan to hold and rent it out for a while! 

What is the smartest move?

a) REFI 

b) Keep riding the ARM for a bit with the low but adjustable interest and paying down the principal pretty substantially

[John D.]

@Eric Black sounds about right.

best thing to do would be to run the two scenarios in a spreadsheet, based on different refi interest rates.

in that manner you can figure out what interest rate should trigger you to immediately refi, at any given point in time in the future.  just sit tight till then.