Second Mortgage

Is it wise to refinance a fixed mortgage with a 2-year ARM?

Would it be wiser to do the 50-year fixed or a 2-year ARM and then refinance after 2 years for a fixed rate? Paying closing costs twice in two years seems like a lot of money to you.

You need to keep what you have and do NOT, don’t refinance a ARM.

That would take you down a very slippery slope and in 2 yrs. you might not be able to refinance at all, then wh?

You need to be conservative now, pay down what you owe. Don’t spend a dime that you don’t absolutly have to and save any thing you can. That rate you have you won’t get again and rates are apt to rise before your 2 yr. and all that money to close and all the talking will put you in the hole.

Don’t let anyone talk you into it. It will ruin what you have and what you have is better than you think. Never mind home improvements. Save and do a little at a time. At least you won’t owe for it.

The best thing to do would be to hold off on the refinance until you can get your scores up. The rate you will get on a 50 year fixed will be very high with your scores and you will incur closing costs twice with the 2 year fixed rate loan.

Neither option is really appealing. From the info your provided, if you MUST refi now, You can pick doing the 2 year fixed. Yes, you will incur closing costs twice, however, if you improve your credit scores you will qualify for a much better loan then.

In other words would you prefer to pay 7.5% to 9% over 50 years or 7% to 8% for two years, refi, and then pay (depending on the market at the time) 6.5% over 30 or 40 years?

Only you and your mortgage professional can run through the numbers for your specific scenario to determine what makes the most sense for you.