Can you brefinance/b an adjustable bmortgage/b as a fixed bmortgage/b b.../b
Sure they can, all mortgages can be redone. Since they do not usually adjust for 2 years the homeowner has time to get their credit rating up to qualify for a great mortgage rate.
Of course it seems that most people do not use the time of a low mortgage rate to clean up their credit. But this is a free country, you are free to have bad credit or good credit, which ever you want.
No one is “being pounded” by surprise, they all knew this would happen and exactly which day it would happen if they did not make some other arrangement.
They can refinance those ARMS, if they qualify to do so. The problem for many folks, however, is that their ARM balance is now more than their property is worth, due to declining real estate values. Thus, in order to refinance, they will have to show up at closing with the cash to make up the difference between current value and the amount of their ARM loan.
Yes, you can.
However, the reason most of these borrowers opted for ARM’s in the first place is because ARM’s, at least initially, result in lower monthly payments than fixed rate loans. The borrowers couldn’t qualify for the higher payment fixed rate loans, so they took out ARM’s.
So, if they couldn’t qualify for fixed-rate three years ago, then they aren’t going to qualify now, unless they are now earning significantly more income.
