BANKING & FINANCE - May 21, 1994
From Times Staff and Wire Reports
Adjustable-Rate Mortgage Use Up: Rising interest rates on fixed-rate mortgages pushed more than half of California home buyers into adjustable-rate mortgages last month--for the first time in five years. Adjustable-rate loans offer lower initial rates, but the rates can rise by up to 6 percentage points in typical cases if inflation heats up, swelling home buyers’ monthly payments. Of the 31,389 California home purchases financed in April, 16,471, or 52.5%, were financed with ARMs, the real estate data company Dataquick Information Services reported. Not since April, 1989, when 56.6% of buyers used ARMs, had the figure exceeded 50%, Dataquick said.
