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  • September 30, 2006 at 8:15 AM #7637
    powayseller
    Participant

    The average fixed rate loan is $260K, while the average adjustable rate loan is $390K, according to data from the Federal Home Loan Finance Board. See p. 14 of this .pdf file

    Doesn’t this mean that ARMs are affordability products, allowing a borrower to take on a bigger loan?

    I thought it interesting that the average adjustable loan is 50% higher than the average fixed rate loan. Let’s use these figures the next time we compute the number of people affected by adjusting loans.

    September 30, 2006 at 8:52 AM #36888
    PerryChase
    Participant

    Not surprising. I’d surmise that the greatest proportion of houses that sold for $700k or above in SD have ARMs. For that reason, the pain at the higher end will be felt much more severely. I expect $1 million houses to go begging.

    September 30, 2006 at 10:29 AM #36893
    powayseller
    Participant

    What about $1.5 mil “superior properties”?

    September 30, 2006 at 12:05 PM #36894
    MaxedOutMama
    Participant

    Yes, they are affordability products. It also points out the fallacy of countiing loans rather than loan balances when estimating overall impact.

    The worst by far are those 100% financings.

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