An adjustable-rate mortgage may be the best option at this time to lower your mortgage rate

DDA Mortgage • October 31, 2022

If you're looking for a mortgage, you have a lot of options. And one of the most popular choices, when interest rates are higher, is an adjustable-rate mortgage (ARM). But what exactly is an ARM? And why do so many people choose to get them as rates climb?



What you need to know about adjustable rate mortgages (ARMs)


Let's start with the basics: ARMs are mortgages that have interest rates that change over time.


Typically, an ARM will start off at a low rate and will increase or decrease as interest rates increase or decrease. Because adjustable-rate mortgages are adjusted, there is less risk to the lender, so they offer more favorable rates than your typical 30-year fixed mortgage.



Your Adjustable Mortgage Rate (ARMs) Options


In general, you want to get an adjustable-rate mortgage to take advantage of the lower initial rate. When rates drop, you want to refinance into a fixed mortgage with a lower rate. To avoid rate fluctuation in an ARM, we suggest applying for a 5 year or 7 year adjustable rate mortgage where you are locked into a known interest rate for 5 years or 7 years.



How Does A 5-year Adjustable Rate Mortgage Work?


A 5-year adjustable-rate mortgage (ARM) is a type of mortgage loan that's fixed for 5 years, then adjusts annually over the course of the remaining term.


The idea behind an ARM is that you'll be able to afford a higher home price than you might be able to with a fixed-rate mortgage because the monthly payment will be lower during the first five years of your loan. This allows you to buy a house without having to put more money down in order to qualify for a lower interest rate.



How Does A 7-year Adjustable Rate Mortgage Work?


Like the 5-year ARM, a 7-year adjustable rate mortgage is a type of mortgage loan that's fixed for 5 years, then adjusts annually over the course of the remaining term.


A 7-year ARM has an introductory period, or "honeymoon," where you pay a fixed interest rate for the first seven years of your loan. At the end of that time, your interest rate will be adjusted yearly based on market conditions and other factors.


If you're looking for a lower initial monthly payment, this is one of the best ways to get it. But if you want to lock in a specific rate for the life of your loan, you may want to look at other options.



Fixed Rate Mortgage vs. Adjustable Rate Mortgages


What's more important to you—getting the lowest monthly payment or avoiding any uncertainty?

In the short term, ARMs are the best for getting you the lowest monthly payment now. Fixed-rate mortgages guarantee that your principal and interest payments will not change. There are risks to both choices, but the most important thing to remember is you can refinance and go from an ARM to a fixed mortgage or from a fixed mortgage to an ARM.



When Shopping For A Mortgage Don't Lose Sight Of What's Important


There are so many great things about buying a home: You can make it your own, you can start building equity, and it's an investment in your future.


Rates are going to drop in the future, and when they do, you'll be glad you got a great deal on your home now! Adjustable rate mortgages are just another tool to get you there.


If you are shopping for a home, call us now (727) 784-5555. We will show you all your options, not just the traditional ones.


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Finally, putting a stop on the trigger list

By Didier Malagies • September 10, 2025
Excited to share a major update that will make the homebuying process more secure and less stressful. President Donald Trump recently signed the Homebuyers Privacy Protection Act of 2025 into law. This bill is a significant victory for the real estate industry, as it directly addresses the problem of unwanted calls, texts, and emails that often flood clients upon mortgage application. What's Changing? For years, many borrowers have experienced a barrage of unsolicited contact from different lenders immediately after their mortgage application. This happens because of "trigger leads"—a process where credit reporting agencies sell information to other companies once a credit inquiry is made. Effective March 5, 2026, this new law will put a stop to this practice. It will severely limit who can receive client contact information, ensuring client privacy is protected. A credit reporting agency will only be able to share trigger lead information with a third party if: • Clients explicitly consent to the solicitations. • The third party has an existing business relationship. This change means a more efficient, respectful, and responsible homebuying journey. We are committed to a seamless process and will keep you informed of any further developments as the effective date approaches. In the meantime, you can use the information below to inform clients how to proactively protect themselves from unwanted solicitations.  Opting Out: • OptOutPrescreen.com: You can opt out of trigger leads through the official opt-out service, OptOutPrescreen.com. • Do Not Call Registry: You can also register your phone number with the National Do Not Call Registry to reduce unsolicited calls. • DMA.choice.org: For mail solicitations, you can register with DMA.choice.org to reduce promotional mail. tune in and learn https://www.ddamortgage.com/blog didier malagies nmls#212566 dda mortgage nmls#324329

Finally putting a stop to the Trigger leads from happening

By Didier Malagies • September 10, 2025
We're excited to share a major update that will make the homebuying process more secure and less stressful. President Donald Trump recently signed the Homebuyers Privacy Protection Act of 2025 into law. This bill is a significant victory for the real estate industry, as it directly addresses the problem of unwanted calls, texts, and emails that often flood clients upon mortgage application. What's Changing? For years, many borrowers have experienced a barrage of unsolicited contact from different lenders immediately after their mortgage application. This happens because of "trigger leads"—a process where credit reporting agencies sell information to other companies once a credit inquiry is made. Effective March 5, 2026, this new law will put a stop to this practice. It will severely limit who can receive client contact information, ensuring client privacy is protected. A credit reporting agency will only be able to share trigger lead information with a third party if: • Clients explicitly consent to the solicitations. • The third party has an existing business relationship. This change means a more efficient, respectful, and responsible homebuying journey. We are committed to a seamless process and will keep you informed of any further developments as the effective date approaches. In the meantime, you can use the information below to inform clients how to proactively protect themselves from unwanted solicitations. Opting Out: • OptOutPrescreen.com: You can opt out of trigger leads through the official opt-out service, OptOutPrescreen.com. • Do Not Call Registry: You can also register your phone number with the National Do Not Call Registry to reduce unsolicited calls. • DMA.choice.org: For mail solicitations, you can register with DMA.choice.org to reduce promotional mail. Didier Malagies nmls212566 DDA Mortgage nmls324329 

When is the right time to refinance your mortgage

By Didier Malagies • September 8, 2025
Good question — refinancing can be a smart move, but the timing really matters. The "right time" to refinance your mortgage depends on a mix of personal and market factors. Here are the main ones to weigh: 1. Interest Rates If current mortgage rates are at least 2% lower than your existing rate, refinancing could save you money. Example: Dropping from 7% to 6% on a $300,000 loan can save hundreds per month. 2. Loan Term Goals Switching from a 30-year to a 15-year mortgage can help you pay off your home faster (though monthly payments are higher). Extending your term may lower your monthly payment but increase total interest paid. 3. Equity in Your Home Lenders usually want you to have at least 20% equity for the best rates and to avoid private mortgage insurance (PMI). If your home’s value has increased, refinancing can help eliminate PMI. 4. Credit Score If your credit score has improved since you got your mortgage, you may now qualify for much better rates. 5. Life Situation Planning to stay in the home at least 3–5 years? That’s often how long it takes to “break even” on refinance closing costs. If you might sell sooner, refinancing may not make sense. 6. Debt or Cash Needs A cash-out refinance can help if you want to consolidate higher-interest debt, fund renovations, or free up cash — but it raises your loan balance. ✅ Rule of Thumb: Refinance if you can lower your rate, shorten your term, or eliminate PMI, and you’ll stay in the home long enough to recover the costs. tune in and learn https://www.ddamortgage.com/blog didier malagies nmls#212566 dda mortgage nmls#324329
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