And, many lenders require personal guarantees as a matter of course! (We require personal guarantees only in a small minority of the loans we do…only when underwriting finds it to be really necessary.)

We are church loan specialists and we don’t hold our noses when we do church loans. We love helping churches, we loan over $100 million a year to churches, and I would love to hear how we can help you.

That’s because too many people bought too much house and used the low introductory rate to “qualify” for a loan for which they otherwise would not have been approved.

They were banking on two things, for the most part…..first, that their income was going to go up, and second, that the value of the house would go up.

Well, the low fixed rates expired, and the payment jumped. Many borrowers couldn’t cover the new payment, due to unemployment or other financial difficulties…and couldn’t refinance to a lower fixed rate because the house value had not appreciated as expected–and may have even dropped significantly.

But this isn’t an article about the housing bubble or the mortgage crisis or the recession, so let me get back to talking about ARM’s.

In the right circumstance, an ARM is a perfect mortgage product that works well as part of a long-term financial plan.

Example:

If you are planning to sell your home within the next five or six years, you may be able to refinance your existing loan to a 5/1 ARM fixed at 4.5% for five years….and not pay anything to do that refi. So even if you are sitting there happy with a 30-year-fixed rate in the low fives, you should look into refinancing to this product.

So the problem with ARM’s isn’t inherent to the product itself. Rather, the problem is that ARM’s are sometimes mis-used, often at the urging of a mortgage broker who is looking for quick bucks rather than life-long clients.

Be smart. Talk with a trusted mortgage advisor who will understand your short and long-term financial needs and will work hard to get you the loan that is truly best for you and your family.

Call me, and let’s discuss your situation. An “evil” ARM may (or may not) be your financial best friend.