[aidenn0]

The weird thing is that 5 year adjustable rates are higher then 30yr. fixed. That only makes sense if interest rates will go down over the next 5 years, which seems unlikely to me.

[hapless]

Fixed-rate mortgages are government-subsidized by a range of mechanisms (Fannie, Freddie, FHA, etc)

Adjustable-rate mortgages are not.

[JackFr]

As a banker I am perfectly indifferent whether I make a fixed rate loan or a an adjustable rate loan to the borrower.

I look my cost of funds, tack on my spread and that is the price you pay.

[elif]

If you look at it from the bank's perspective it makes more sense. I got a 5 year and paid it off early. The bank got about 8% of my home value. My friend has a 30 year and the bank will get ~110% of his home value.

[aidenn0]

This is for 30 year 5/1 ARMs the term is the same, but the rate is not locked