Freddie Mac: Here are the top 5 improving metro markets for housing

The Census Bureau is cooking the new home sales numbers

You can’t make bricks with imaginary straw

The 12 hottest housing markets right now

And the biggest losers in the price growth race
W S
Lending / The Ticker

Affluent shoppers turn to ARMs to get low rates

luxury home
/ Print / Reprints /
| Share More
/ Text Size+

Affluent home shoppers are willing to accept the risk of a jumbo adjustable-rate mortgage in order to lock in at a 2.5% interest rate. Per The Wall Street Journal:  

But borrowers are undeterred. During the first eight months of the year, 75%, or 5,656, of private jumbo ARMs that were originated for home purchases had a fixed rate period of just one year.

Experts say some of these borrowers are betting that interest rates won't rise much in the near future, especially if the economic recovery doesn't pick up. "They've heard that rates will rise so many times that they've become dull to it—it's like crying wolf. If it ever happens we'll deal with it," says Jack McCabe, a housing analyst in Deerfield Beach, Fla., who provides research reports to investors buying these mortgages.

Source: WSJ
Read full story

Recent Articles by HousingWire Staff

Comments powered by Disqus