"Plans change, right? Gotta factor that uncertainty in somehow..."
Totally relate to this. When I bought my first rental property, I went adjustable thinking I'd refinance or sell within five years. But then the market dipped, and refinancing wasn't favorable anymore. Ended up holding onto it way longer than planned, and every Fed announcement had me crunching numbers again. Lesson learned: always run scenarios for the "what if" moments, not just the ideal timeline.
"Lesson learned: always run scenarios for the "what if" moments, not just the ideal timeline."
Couldn't agree more. Did you factor in potential rate caps when you ran your numbers? Those ceilings saved me big-time when rates jumped unexpectedly... definitely worth checking the fine print carefully.
Good point about rate caps—those can really be lifesavers. Did you also look into how often the rate adjusts? I remember a friend who got caught off guard because their ARM adjusted every year instead of every five... talk about a stressful surprise. Definitely pays to ask those "what if" questions upfront and not just trust the ideal scenario numbers. Better safe than sorry, right?
Yeah, the adjustment frequency is definitely something people overlook way too often. I've seen plenty of folks get excited about the initial low rates and completely gloss over how quickly things can change. A friend of mine had a similar experience—thought he was set for at least five years, but nope, his ARM adjusted after just one year. He ended up scrambling to refinance because the payments jumped significantly.
Honestly, ARMs aren't inherently bad—they can be great if you're planning to sell or refinance before adjustments kick in—but you really need to know exactly what you're signing up for. Always ask your lender directly about adjustment intervals and caps, and run through some worst-case scenarios yourself. It's not pessimistic; it's just smart planning. Better to spend a little extra time upfront than deal with nasty surprises down the road...
One thing I'd add here is that even if you think you'll refinance or sell before the ARM adjusts, life doesn't always go according to plan. Job changes, market downturns, or unexpected personal events can throw a wrench in things. When I was looking into ARMs myself, I ran the numbers on a fixed-rate mortgage too—yeah, it was slightly higher upfront, but the peace of mind knowing exactly what I'd pay each month was worth it for me. Just something else to consider...
