braggbear

Closer Look At The ARMs Reset Problem

Unfortunately, I don't think this article proves anything. Remember: The difference in monthly payments from before the reset to after the reset is not just a function of initial rates and current rates; it is also a function of the fixed margin amount. So even if the current rate is below the initial rate, if the margin is high enough, the payment will go up.

Until I see some data on the average and distribution of margin amount for loans vintage 2003 to 2005, this argument will remain unsettled.