Valencia refinanceFixed vs Adjustable Mortgage Loans

Is it a Good Time to Select a Fixed Rate Mortgage or an Adjustable Rate Mortgage Valencia? Mortgage rates are set to go up soon.Doing a Valencia refinance makes sense while rates are good.

In today’s marketplace, and for the past eight months, ever since the Federal Reserve chose to keep interest rates artificially low by subsidizing the industry, the easy answer is that you should get a fixed rate mortgage.

With rates in the high 4’s and low 5’s, there is no reason to not lock yourself in at this historically low interest rate.Mortgage rates Valencia are low and mortgage lenders are busy.

Only under rare and unique circumstances, like a borrower was certain that they would only be in their home for another 5 years, would a borrower be justified to choose the lower interest rate of a 5 year adjustable mortgage. Primarily because the rate would be fixed for the first 5 years, and they would be out of their loan before the rate adjusted. However, even if a borrower plans on being out in 5 years, what if the home does not sell right away? They would be stuck with an adjustable rate, which could make the mortgage payment much higher than during the fixed rate period.

In today’s marketplace-the conventional wisdom is a 30 YEAR FIXED Rate Mortgage.

One item to remember when applying for a new home loan, the Adjustable rate loan will give you a lower monthly mortgage payment for a fixed amount of years. This will help you overcome the high cost of moving into a new home. However, remember, the ARM will need to qualify at about 2% about the rate you lock. That could effect your DTI and thus your mortgage Valencia approval. Experience counts!!! The mortgage team at


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