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I was wondering if the higher ARM rates would make it harder to sell my home. We had an offer around $800K, the buyers are getting a 30 yr ARM, w/ Countrywide (one of the most lenient lenders). It’s a 5-x-x-x-1 I think it starts at a lower interest rate and adjusts annually. So the way they borrowers get around it is by getting lower teaser rates, or negative amortization loans. The real impact will be in 2006 and 2007, when something like $300Billion and $1.6 trillion, respectively, of ARMs reset. Then there is no introductory rate left and the borrowers have to pay up.
I’m wondering how many lenders are still giving these teaser loans. I would like to see a response to the poster’s question from someone in the mortgage or real estate industry.