Fixed rate or ARMs for buy-and-hold property?

[Molly Haggerty]

Hi all,

New to BP and REI but looking to purchase my first investment property soon. I inquired with a mortgage lender and was provided several options for financing:

1. Fixed rate mortgage for 30 years

2. 3 different ARM options - one for 10 years, 7 years, or 5 years with a 2% increase cap for first two years and 5% cap for entire life of the loan

I would like to buy and hold the property I'm interested in, but am struggling to decide whether a fixed rate or ARM would be best. The ARM rates are enticing, but not sure what to consider with the future state of the market/refinancing. Any advice on the pros and cons?

Thank you in advance!!