Street Capital has rolled out the first nationally available 1-year adjustable rate mortgage.
Paul Grewal, President of Street Capital, says the product is well-suited to those who expect that “discounts on ARM’s will increase.” It gives people “the flexibility to choose a shorter ARM term,” he adds.
Therefore, if you think variable rates will be prime – 0.50% next year, for example, this 1-year variable lets you switch mortgages in 12 months without penalty–instead of waiting 3-5 years.
Street Capital also lets customers convert to a 3-, 4- or 5-year fixed rate at any time, with no fee, and at discounted broker rates.
From a strategic standpoint, it’s a great move by Street. The 1-year term has a clear value proposition in the current market. More importantly, it gets customers in the door—many of which will renew with Street in a year, or lock into a long-term fixed rate.