First time poster, but I knew you were the people to help :) We are under contract for a "fixer upper" for $285,000. "Fixer upper" is generous, but with some hard work and about $60,000, it will be wonderful, and it has a great partially wooded acre lot, which is hard and expensive to find where we are. We will hopefully get it into a livable condition in the next few months, and then list our house, which we should be able to take away about $225,000 after paying off our mortgage and realtor fees. We have an easy 20% to put down in cash, and with the sale of our home, we should be able to get the house paid off quickly. My question is, what type of loan is best when I plan on using our current home sale to pay down the loan, and then pay the remainder of the loan off in about 5 years? Do I shoot for a 15 year loan with low fees/no points and a slightly higher interest rate, or a 5/1 ARM? Paying for the lowest rate with points, won't help if we pay off the loan fast, but I'm not sure the best option here beyond that.
Cost (house + updates): $285,000 + $60,000 = $345,000
Down payment: $57,000
Additional payment after home sale: $225,000
Remaining balance: $63,000