Here’s an editorial from The New York Times on how risky mortgages — such as adjustable-rate mortgages and interest-only loans — are influencing the housing boom across the nation. According to this editorial, “The rates on half of all adjustable-rate mortgages reset [i.e., go up] within three years of being issued!” If you’re like many first-time buyers today who are barely able to afford buying a home now with such low interest rates, will you be able to afford your house payments if the interest rate on your mortgage goes up?
First-time buyers especially should take the opportunity to read what the Times has to say. Make sure to thoroughly explore all your borrowing opportunities with your mortgage broker or loan officer, ideally before you begin house hunting.
