On 30 Jul 2005 17:42:55 -0000, Thrasher Remailer
wrote:

From what I hear, it is a ripoff?

Not necessarily. Basically, it a mortgage that starts with a set rate
and after a period of time can "adjust" to some set value (you can
look at a number of mortgages to see what they are based on - so many
percentage points above prime etc.) and usually have a cap of some
kind. We refinanced a house on a 7 year ARM with a starting rate
around 4% because we knew we weren't going to be in the house more
than a few years and would sell before the rate could climb. If you
plan to move soon, pay off the mortgage soon or think the rates may
drop an ARM could be a good thing. If you plan to stay in the house
for a long time and you want to pay off the loan over a full 30 (or 15
or whatever) or you feel the rates will climb then an ARM may not be
for you.