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ARM Mortgages are back! -- What could go wrong this time?
14 sats \ 1 comment \ @CornMooNaut 5 May 2022 bitcoin
https://www.msn.com/en-us/money/personalfinance/adjustable-rate-mortgages-are-gaining-in-popularity-here-e2-80-99s-how-to-know-if-one-is-right-for-you/ar-AAWKdCI
"You have double the number of borrowers out there applying for ARMs in the last four months because of how quickly the rates have come up," said Joel Kan, associate vice president of economic and industry forecasting at the Mortgage Bankers Association.
"They want to buy a house but are probably moving in three to five years," she added. "If they can lock into a five-year ARM, that could help them reduce their cost and sell in five years before the interest rate recalculates."
They are at it again plebs! what could go wrong ?
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0 sats \ 0 replies \ @k00b 5 May 2022
ARMs aren't nearly as popular as they were during the subprime mortgage crisis in mid-2000s, when credit standards were lax and a lot of borrowers ended up in trouble. These days, the credit standards are a lot higher and underwriting is extremely tight, Kan said.
Would love to see some kind of actual quantitative comparison. Should be easy for a journalist to produce.
"We are not looking at the same kind of risks as we did then," he said.
Famous last words.
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