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Explain ARM Conversions
Question: How does an ARM conversion program work?
Answer: Many ARM's come with conversion programs. For a fee, say $250 to $500, you can convert to a fixed-rate. The conversion rate won't be the best in the world, it is typically about 5/8ths of a point higher than a given index, but it may be better than the fixed rate at the time you applied for financing. The attraction of conversion programs is that they represent a cheap form of refinancing. There is no settlement involved because the loan has already been recorded. Without a new settlement, a host of fees, charges, and taxes can be avoided.
Written by Peter G. Miller.
© 1997 Peter G. Miller. All Rights Reserved. Rules, Disclaimers & Notices.
Copyright © 2012 Realty Times. All Rights Reserved.
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