Check Your Loan Caps

Many people are sitting with adjustable rate mortgages that are ready to explode and they don’t know it. Why? Adjustable mortgages adjust interest rates at a predetermined time. This is known loosely as the cap. You must know your caps intimately so you can map out how your loan is going to be modified. The information on your cap can be found in your loan docs. It should tell you when and how much the interest rate can be increased or decreased. Obviously, very important information. Don’t get caught blindsided!