Yes I know I am waaaay late to the party. I failed to refi previously bc I thought I had a cap on my rate increase. Details are not my strong suit and I have the shitty budgeting to show for it lol. Luckily I have a pretty good income and can cover most mistakes. I'm having a hard time processing this info and my dad was my financial guru--and he passed a few years ago so I'm here looking for help.
Details on current loan:
I currently have an Interest only ARM (but I send more for principal) at 1.25%. In my loan docs it says "D. LIMITS ON INTEREST RATE CHANGES: My interest rate will never be increased or decreased on a single interest charge date by more then 2 percentage points from the rate of interest I have been paying for the preceding 12 months. My interest rate will never be greater then 12.5%". Does this mean my rate cant go above 3.25% or am I reading it wrong? I'm almost certain I am reading it wrong.
I've recently gotten a few loan offers. The most attractive is a 5.375% loan with 1 point for a 30 year fixed. Do I want to lock this in?
Thanks for the advice.
PS: In case it's important, the loan docs also say " C: CALCULATION OF CHANGES: the Note Holder will calculate my new interest rate by adding 1.500 percentage points to the current index. The Note holder will then round the result of this addition to the nearest 1/8 of one percentage points".
Submitted June 15, 2022 at 01:24AM by gardenfordad https://ift.tt/6HpyOcV
