patrick.net

With these numbers, I will take 4.875.

Like others said, 3.875 for 5 year ARM is not a good deal.

Why in the world aren't you thinking 15 year at 3.95?

cloud13 says

I’m more inclining towards ARM because in computer science there used to be a class of algorithms “Greedy Algorithms”.
The theory was that most of the times locally optimal solutions prove to be Globally optimal.

What is your take on it ?

My take on it is that you have to read the f**king document. Not all ARMs are the same; you have to read how your rate will be calculated, by what index, and with what cap. One of my first jobs was temping at a major mortgage loan company and had to explain all this to angry customers who didn't understand why their loans only ever seemed to adjust up, never down.

Thank you friends.
I finally went with 4.375 buying down the interest rate with 2.25 points. I went with this reasoning because paying these extra points is tax deductible anway and I'll break even in next 4 years after facotoring in tax advantage.