The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: bentway who wrote (177405)	1/16/2009 10:28:31 AM
From: GraceZ	Read Replies (1) of 306849

It's an ARM I got when the banksters thought rates would be rising and tied to the Fed rate. Everyone thought rates were headed higher. I remember telling people I was unconvinced we weren't going to continue the 20+ year slide in interest rates down to below 3% on the 30 year. I got lots of good arguments that it wasn't possible to have a 2 handle on Treasuries in the US, but here we are. What is your ARM indexed to, LIBOR? Years ago we had a HELOC that was a variable rate as well, indexed to LIBOR. Since we didn't have any use for it personally, I used it in place of a business line of credit (which at that time a lot more expensive). I think it started out at 8.5% and eventually hit a low around 3%. We paid it off with everything else. What was funny was that every time the rates fell the bank would call me up and try to convince me to swap out the variable rate for fixed which was always a little bit higher rate (they'd be happy to do this without charging fees or doing an appraisal). It was a pretty funny conversation on my end. They acted like they thought I was nuts for turning them down each time.

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