Mortgage Rates: Fixed Or Gamble?

Who would have thought a year ago that mortgage rates would still be so low? Initial teaser rates for one-year, adjustable-rate loans have slipped from an average of 5.45% in July to 5.20% today, with some ads boasting 4.5%. And 30-year fixed rates are the lowest they've been in a decade, averaging 8.13% but hitting 7.75% in some regions. Choosing between the two types is a dilemma not only for home buyers seeking new loans but for those who leaped at "convertible" ARMs a year ago and may now switch to a low fixed rate.

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