Interest rates have been rising; in May, the Federal Reserve raised rates for the 11th time since February 2005. If you have an adjustable-rate mortgage (ARM), you might be in for sticker shock when your initial fixed-rate period ends or your annual rate adjustment comes around.
ARMs remain a good choice for many people, such as those who plan to move within a few years or those whose budgets can accommodate higher payments. But you may want to refinance to a fixed-rate mortgage if you plan to stay put for many years and don’t want to be squeezed by rising rates. Since interest rates have gone up and may continue to rise, the security of a fixed-rate mortgage may hold more appeal. It’s easier to budget when you know that your principal and interest payment will remain the same for the life of the loan.
With the variety of fixed-rate mortgage options available at The First, you may even be able to lower your monthly payment or shorten the term of your loan.
How to Decide
When weighing whether to refinance from an adjustable-rate to a fixed-rate mortgage, consider:
We Can Help
Our home loan experts can help you "run the numbers" to decide whether refinancing is the right option for you. If you conclude that it is, they’ll also help you choose a mortgage that fits your budget and your plans for the future.