|
USA | Have a bank I deal with that offers 2 and 6 caps on a 20 year note. Might check Farm Credit they may offer some type of cap program.
IMO borrowing long term money on short term rates at 3 -3.5% with a 9-9.5% cap doesn't look all that risky With a 2% yearly cap worst case would take 3 years to get to the cap rate. Using 3% starting rate, if int went up 2% per year. Ave rate for the first 3 years would be 5%. If rates stayed at 9% for 3 more years ave rate for 6 years would be 6.5%. Worst case under this type of loan would be an ave interest rate of 8.4% for 20 years.
Edited by coup 12/26/2009 13:48
| |
|
long term interest rates caps?
