Good for you. I have a 5-year ARM that started in 2004 and will reset in 2009. The rate is fixed at 4.25%. With that I was able to buy a dream house in an excellent school district, and qualified on just my income. A 30-year fixed mortgage at that time was around 6.5% and I would not have been able to make the payments on my income. The ARM allowed my husband to stay home with our kids for the first two years in our new area which was a boon for them. I knew that within 5 years my husband would be well employed and we will be able to afford any increase in our payments. Now it appears likely that rates will fall by 2009 and we may not have much of an increase at all, and if we do we will be able to refinance easily. Our house has also appreciated by over $100,000 since we bought it in 2004. We do not live in a “boom/bust” area and the house has been an excellent investment. We put 20% down on our house and now have almost $300,000 in equity.
Your situation sounds very similar to mine. Think the WaPo will write a story about us? ;-)
Interest only loans are not the root of all evil that the press is making them out to be. But just like guns, in the hands of a moron, anything can be dangerous.