Best advice I could give, lock in a fixed mortgage no matter how attractive ARMs may look. Just out of curiousity, are you buying in any bubble-prone area?
DJ report indicating June eurodollar futures pricing in 88% chance of a 5% funds rate in 2Q06 and 100% chance in 3Q06 vs. 72% chance on Monday.
Yes, I'm in Vegas, which is definitely bubble-prone. However, I just sold a residence with considerable equity, so I'm really at no more risk in the new residence then I was in the old. I guess if I was really smart, I would have sold my home and began renting until the market leveled out. But, I'm going to take my chances under the assumption that I'll be in the house for at least 5 years and I plan to pay down my mortgage considerably.
I'm actually doing an ARM, but my rate is locked for 10 years. I did extensive analysis on where I'd be in 10 years using a 30 year fixed and the 10 year ARM, and the extra payment going to principal each payment with the 10 year product made it a no brainer. Famous last words, right?