Prime Rate Credit

For the first time in several weeks now, it is being reported that mortgage rates are on the rise again. However, economists are saying the the rising mortgage rates should not raise so high that they further discourage prospective homebuyers in an already weak home buying market, since they are not even expected to reach 7% in the year 2007.

Included in the overal rise of mortgage rates was the rise of ARM mortgages, which are Adjustable Rate Mortgages (we talked about them before), which can be adjusted according to the marketplace and what’s going on in the housing market.

Actually one of my friends at work has an ARM loan, and she recently found out the hard way that these types of loans, which can be tempting to some hombuyers at first due to low introductory rates, can be dangerous.

Her loan rate on her ARM went up, and so her mortgage payment increased by several hundred dollars in a matter of just a few months, so needless to say, caution is called for when looking into getting an ARM mortgage loan because of their fair amount of unpredictability.