Mortgage rates are going up. Would it be crazy to go with an adjustable rate mortgage now?

Excellent question! The economy is heating up. Federal Reserve watchers are predicting possible rate increases – plural! – in the months to come.

And adjustable rate mortgages are still so attractive – adjustable rates are so low! But no one wants to make a mistake on something as significant as a mortgage.

So … is there any good reason for someone buying a house today to go with an adjustable rate mortgage instead of just locking in a still-historically-low fixed rate?

At Canton Co-operative Bank, we believe there are several very good reasons why a borrower might go with an adjustable rate mortgage … even with rates rising. And this is absolutely one of those situations where you really want to be working with a local *good advice* lender like Canton Co-operative. We are dedicated to doing the math and taking the time to help you consider all of your options.

For example, if you plan to be in a home for only a few years, then an adjustable rate mortgage can easily be the right way to go. This applies to people who are expecting to make a corporate transfer, to military personnel, young homeowners who plan to trade-up from a first home and older homeowners in transition.

An adjustable rate mortgage might also let you stretch now to buy “more home.” But this only really works if it’s a fairly short-term stretch, meaning you think your income will be going up in the next few years. Also, you have to be sure that the costs of possibly switching into a fixed-rate loan later don’t outweigh the benefits of going with an adjustable rate mortgage now.

There are some ridiculously-complicated “exotic” adjustables out there. At Canton Co-operative, our adjustable rate mortgages are “plain vanilla.” Our caps are reasonable and our terms are very straightforward and easy-to-understand. Wondering if an adjustable rate mortgage might work well for you? Come see us or call/email Stan Taylor at 781-828-8811 x4 or Bela Vasconcelos x37.

Canton Co-operative Bank is located in downtown Canton at 671 Washington Street, Canton, MA 02021.
The main phone number is 781-828-8811.

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