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Also worth noting: not all ARMs have a balloon payment. For example, I bought most of my farm on a 20yr ARM with a 20yr amortization. As interest rates rise I w

Also worth noting: not all ARMs have a balloon payment. For example, I bought most of my farm on a 20yr ARM with a 20yr amortization. As interest rates rise I will have higher payments, but there’s no moment when the music stops and the rest of the principle immediately comes due.

brewdad 4y ago
There is still the risk of an interest rate reset raising the payment amount to an untenable level though. Maybe not in your specific case, depending on your circumstances, but for many others it will be true.