Option arm and the MTA - Posted by Chris

Posted by Shaun on June 10, 2006 at 11:58:41:

I just sent you a pretty detailed email that should help you decide if the option arm is the loan that you are looking for. Good luck!

Option arm and the MTA - Posted by Chris

Posted by Chris on June 10, 2006 at 06:23:07:

Does anybody out there have a feeling for the future value of the MTA index? I know what it has been historically…I also know that it is fairly certain to continue rising in the next 12 months. Afer that, I don’t know if predictions have any skill. I’m asking because I’m considering converting the financing on 15 of my properties to option arms. Any comments would be great.

Re: Option arm and the MTA - Posted by gene

Posted by gene on June 13, 2006 at 16:10:07:


First, as a mortgage broker we learn how these things behave.
Here’s how they work:
They use a rolling average approach so even if rates don’t move for awhile some relatively high numbers are being rolled in at every adjustment period from past months which tends to keep the rate up.
When the high numbers have all been averaged in then the index can settle down.
Which should take a few more months.
My personal belief is that U.S. rates are artifically high right now to support the dollar on the foreign currency exchanges -
we have the highest rates in the world next to Australia.
Other than supporting our currency rates don’t need to be this high.
With gas prices at $3/gal the economy has little chance of overheating.
So we’re probably looking at the top of this little peak right now.
You probably don’t have much upward risk and a lot of cash management advantages to an option ARM right now.
As a mortgage broker, we have access to all the MTA based Option ARMs and also the COFI (11th dist.) based Option ARMs which are less violatile, but have slightly higher start rates.

Re: Option arm and the MTA - Posted by Dealmaker

Posted by Dealmaker on June 10, 2006 at 12:47:48:

I can help you to obtain your option arm loans. I can beat any offer!