AN, it is true that now seems like a good time because of the rates and you know, kind of got the itch to buy our long term house since over the years we saw many friends of ours buying and raising happy families there….I know, I know – sort of keeping up with Joneses…not a good idea.

I was actually expecting a lot more of conservative replies, and some heated ones bashing me for NOT putting 20% down AND borrowing from 401k…

It is a scenario worth considering – renting is CHEAPER than owning, after all. Saving enough to lower the financing under 417K might save enough in terms of interest – and then guarantee a lower monthly payment, even with higher interest rates. Besides, the prices may be lower then.

What would Piggs think about this case? If the rates are much higher, would you go for a longer (7-10 yr) ARM and then refi when rates drop more? Is that cost effective?