I don't know if interest rates will go up or not, but when rates do go up, they can be swift. The Adjustable Rate Mortgages offered by for example First Republ

I don't know if interest rates will go up or not, but when rates do go up, they can be swift. The Adjustable Rate Mortgages offered by for example First Republic Bank are referenced to one-month LIBOR, and it went from 1.11% in May 2004 to 5.11% in May 2006, i.e. 4%-points in 2 years. On a $1M mortgage, that's $40k per year in swing over two years (typically deductible, so you'd have to factor in your marginal tax rate to get effective cost). http://www.macrotrends.net/1433/historical-libor-rates-chart http://www.macrotrends.net/1433/historical-libor-rates-chart