I totally disagree with you. These arms will start costing people houses in about 12 to 118 months at a high rate.
118 = 18, coffee level low.
Well I did say in certain situations, and there are many types of ARMs. Some ARMs are fixed for as long as five years. I would not want an ARM that wasn't fixed for at least some period of time. If someone bought in 2001 in Las Vegas or MD on a 5-year fixed ARM they would have built up a huge amount of equity due to appreciation. They would have been paying a very low rate, even by the standards of the past 6 years. They could have invested the money they saved with the extra low rates. And they could have just locked in on a 30-year fixed back in November when they rates were close to their recent low points. An ARM is also an excellent choice if you plan on selling before it is time for your rates to be readjusted. I would be a little more weary of ARMs at this point in time, but it is still a good option for some people.