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Thanks, all. I checked out ingdirect.com. The savings plan sounds like it will be a good way for me to go.

While there, I came across their ARM mortgages. On initial inspection it sounds like they could reduce my monthly payment, in the short term. In the long term, my intrest rate could go up significantly. I could always refinance if that happens.

So, I could reduce my monthly payment by about $150-$200, which would help my debt reduction plan. I'm trying to find the downside.

Have any of you had experience with ARM mortages, with ING or elsewhere? What's the catch that I'm missing, if any?

Thanks again,
Logan
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Hi, Logan.
I looked into ING's ARMs about 3-4 months ago. I instead decided to go with Virtual Bank's fixed 15 yr. The rate was low enough (4.75, I think) that I figured sub 5 fixed was less troublesome than a 3.99 ARM. Not sure what the rates are today but you might also want to look into it. Virtual Bank made everything very easy.

96hokies
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Have any of you had experience with ARM mortages, with ING or elsewhere? What's the catch that I'm missing, if any?

I was able to reduce my monthly payment, eliminate PMI, and elimnate tax/insurance escrow through ING's 5-1 ARM. It'll hurt if rates go up significantly and I have to refinance, but for now it's good.

Applying online for the mortgage was easy. Troubleshooting the further process was problem-ridden. I was misled by a phone rep when I asked a question about completing required forms that had been mailed. Two weeks later when no action had been taken (as per their "application tracker" web service I called to find out what I'd been told was wrong and that I needed to resubmit a form.

Two weeks later, lack of further action led to my phone inquiry regarding application status, during which I was told to ignore the online "application tracker" because it doesn't always reflect the reality of the process. I was advised I'd be receiving a call to set up the closing meeting soon.

I emailed their ombudsperson regarding this bit of silliness, the online status that isn't.

I didn't receive the call, and inquired again. Was told I'd be called by person X within three days. I wasn't called. Called customer service to register my frustration with the process. Was called, arranged closing appointment.

Closing appointment required fees that I had been told were to be rolled into the refinance. Got cash advance check at local bank. Continued with closing until the closing agent became aware he didn't have all necessary materials. Had to stop cash advance (bank undid it without fee) and had to reschedule.

Second closing meeting was successful. I'm happy with the product.

I found the service remarkably frustrating, having been misled multiple times over the phone and holding a closing meeting with a rep that hadn't even confirmed all paperwork was in order. I'd do it again because the cost savings is worth it to me. But I'd expect a comedy of service errors and be less patient before calling when suspicious of problems.

Good luck,

Bruce
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I could always refinance if that happens.


Sure, as long as none of the following happens:

1. Interest rates zoom up, making a change in lenders moot.
2. You lose your job and can't find a new one.
3. Housing values plummet in your area.
4. You become disabled, and can no longer work.
5. Your income decreases, causing you to become unable to handle the new payment (or causing you to not be able to be financed)

So, I could reduce my monthly payment by about $150-$200, which would help my debt reduction plan. I'm trying to find the downside.

Can you tell I'm not a fan of ARMs? The downside is that you are stuck with the downside, rather than the lender. If rates go up, YOU are going to pay more. "Even if"

ARMs are just a way to get the consumer to shoulder the burden of the risk of rates increasing. Instead of locking in a low rate, and causing the lender to be locked into that same less-profitable-to-them rate, you gamble that rates will stay low.
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ARMs are just a way to get the consumer to shoulder the burden of the risk of rates increasing. Instead of locking in a low rate, and causing the lender to be locked into that same less-profitable-to-them rate, you gamble that rates will stay low.

I doubt they care much about anyone's mortage being at a low, less profitable rate. Not specifically anyway. They are going for volume at a good average on their overall portfolio. When interest rates are high they may have plenty of underperforming liens but when rates are low they have plenty of OVERPERFORMING liens from all the people that locked in at the high rates. It all works out.

xtn
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When interest rates are high they may have plenty of underperforming liens but when rates are low they have plenty of OVERPERFORMING liens from all the people that locked in at the high rates. It all works out.

Until times like these when everyone and their dog is refinancing.
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