After running neck-and-neck for several months, interest rates for fixed-rate mortgages and adjustable-rate mortgages are finally diverging.
Despite pricing worse than its fixed-rate counterpart throughout much of August and September, ARMs are now close to 0.375 percent lower for conforming products sold through Fannie Mae and Freddie Mac.
This equates to roughly $25 per month per $100,000 borrowed.
If you know that you don’t need a 30-year rate commitment from your lender, you may find that a well-structured ARM is a real money-saver.
(Image courtesy: Bankrate.com)