With all of the hubbub about the so-called “mortgage crisis,” I guess someone wanted to write a story about people who weren’t screwed by their mortgages.. So, my friend, former boss, and now real estate broker Jessica forwarded my info to a reporter who was doing an article about people that did ok with their ARMs…
Dennis Yang, vice president for a corporate intelligence firm, has a similar story. “I didn’t need to pay for the security of a 30-year mortgage,” he says. “Why pay for knowing what your payment will be in 30 years when you know you’re not going to be there?” Yet, when he bought his Hayes Valley condo in 2004, this wasn’t the first advice he received. “I approached my boss for advice, and he told me I should always get a 30-year fixed no matter what.” Instead, Yang chose an ARM that would allow him to invest more money in stocks. “I didn’t want all of my savings to be in my home,” he explains. “This allowed me to be more balanced in my investments.”
Amassing the knowledge about house buying and mortgages is a whole lot of information to accumulate, and then once you’re done, you pretty much never need to know about that stuff anymore (until you buy another, I guess).. But yah, I feel like they make mortgages over-confusing, and they should just present them in clear terms, without ALL of the numbers.. Like, the way that I felt about the ARM, was that I pretty much didn’t see myself keeping my house for longer than 7 years, so I could deal with 2 years of variability.. That said, back when I bought, I had no idea that rents would come up so much in SF, so now, had I gotten the 30 year, renting my house out would be an interesting option — that said, I think renting a place with an ARM seems like a risky proposition.
[Thanks Ashley for forwarding me the article... Google news hadn't found it yet.]