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Jack Sherry

Owner/Broker

Jack Sherry Real Estate & Investments

101 N. Hinckley

Holdenville OK 74848

Office:  (405) 379-3977

Fax:     (405) 379-6134

Mobile:  (405) 221-1325

jsrei@sbcglobal.net

Nancy Sherry

Broker/Associate

Mobile:  (405) 380-6517

nsherryrealestate@yahoo.com

Paige Sherry

Sales Associate

Mobile:   (405) 380-6715

paigesheffield_realestate@yahoo.com

 

 

Tara Goodson

Sales Associate

Mobile:  (405) 380-8033

taragoodson_realestate@yahoo.com

Dawn Lindsey

Provisional Sales Associate

Mobile:  (405) 221-7161

dlindseyrealestate@yahoo.com

 

 

 

 



Jack Sherry Real Estate & Investments
101 N. Hinckley
Holdenville, OK 74848
Phone: (405) 379-3977
Fax: (405) 379-6134
Email: agent@jsherryrealestate.com

Thank you for visiting today. If this is your first visit, take your time and look around. We have plenty of information and resources available to you. If you are a return visitor, thank you. We would love to hear from you. We can serve all your real estate needs.

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Adjustable Rate Mortgages - The PROS & CONS

Now that you know what an ARM is and how it works, you may be wondering what the advantages and disadvantages are. So let’s explore that issue.

Offering adjustable rates allows lenders to transfer part of the interest rate risk from themselves to the borrower. If you get a fixed rate mortgage and the interest rate then goes up, it costs the lender money. However, if you have an adjustable rate mortgage, as the interest rate goes up, so does your payment, thus compensating the lender. Adjustable rate mortgages are particularly useful when unpredictable interest rates make fixed rate loans hard to get.

One of the main advantages of an adjustable rate mortgage is that the initial interest rate is lower than that of a fixed rate mortgage. A lower rate means lower payments, which may help you qualify for a larger loan. This is an important detail if you expect your future earnings to rise. In this case, the ARM will allow you to qualify for a larger loan amount earlier rather than later.

However, this information should only be used with care. If you use an ARM to qualify for a larger loan amount than a fixed rate would allow you and the interest rate then rises drastically or your income doesn’t rise, you may not be able to afford the larger monthly payments, thus causing you to default on your loan.

A situation in which an adjustable rate mortgage makes sense would be if you are only going to keep the house for a short period of time. If you are only planning to own your house for only a few years, the risk of the interest rate rising goes down. This means that you will get a better rate with an ARM, making it a good choice. However, if you plan on staying in your home for a long period of time, a fixed rate may be a better option.

The lesson here is to have a plan. Know what your goals are in purchasing a home and plan for all eventualities. Do your research when shopping for an ARM and consider the worst-case scenario.

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Testimonials

Thank you so much for your thoughtfulness,patience,fortitude, understanding and efforts. It's a joy knowing you. Thank you for all you've done. Sincerely E. Blair
On behalf of my mother, wife and myself, I thank you for assisting in selling our family home. Your down home understanding and professionalism was second to none. M. Carter
Thank you so much for all your help. You have made this a very easy process for me. Thank you again. T. McCorry
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