I would concur with the answers below. The most important thing is that you feel comfortable with the terms of your loan. I highly agree with the comment below that you should try and educate yourself or find someone that will educate you, not only on the current market, but understand how your decision today will effect you in the future. The first question you should ask yourself is how long do you intend to live in the property? This question is sometimes easier said then done, but you should have a general idea going in. The next question would be, what is your risk-threshold? Some borrowers are ok with shorter term Armâ€™s vs. a longer-term fixed loan. Each borrower is unique in their needs/wants, and only they can answer this question. For an ARM product, I would also ask questions like, what index is the ARM attached to, LIBOR, COFI etc. What is the maximum adjustment the rate could go up or down after the fixed period? When will the adjustment period end, and what effect does this have on my payment? Can I sell my home anytime without a pre-payment penalty? Although these are just a few questions I hope this gives you a start. Again, I truly believe the main thing is that you should feel comfortable with your decision. To do this you have to be informed, and ask the right questions.
Thank you, and my hope is that this information at the very least gives you a few ideas of where to start with your questions.
Have a great day.
Senior Mortgage Banker