Rising Balloons Can Be Financially Deflating
     A fter 90 days of rapidly rising mortgage rates ''balloon'' mortgages are in vogue again. Beware of the hot air.
     Lenders and brokers hawk balloons because typically they are cheaper than 30-year fixed rates. Even though balloons aren't as cheap as one-year adjustable rate mortgage's (ARM) first year rate, they are often a better deal during the second year when the ARM jumps.
     When rates rise quickly, as they have recently, a balloon mortgage's savings, well, balloons. Typically requiring 10 percent down, balloon mortgages are conforming mortgages ($240,000 or less) that are often called ''30-due-in-5'' or ''30-due-in-7'' loans. They are amortized over a 30-year schedule, but after five or seven years of payments, the loan matures and a big fat balloon of a balance is due, hence the name ''balloon'' mortgage.
      At maturity, you can pay off the mortgage, refinance, or in some cases, convert or reset the loan's interest rate for the balance of the 30-year fixed-rate loan.       Unlike ARMS which reset or adjust repeatedly over the life of the loan, resulting in multiple changes to the monthly payments, convertible or reset balloons come with only adjustment, Freddie Mac says.

When Can We Move In?

     M any buyers wonder when they actually can move into their new home. They wonder when possession actually takes place. Most buyers take possession of their home the day of closing. The keys and other security devices are handed from the seller to the buyer at the closing and the house has officially changed ownership. In some areas the seller retains possession at no cost for three to five days after closing, but the customary day of possession is the day of closing. You do not need to wait to move in until you receive the deed, which will usually be mailed to you from the recorder's office after it has been properly placed in the public records.
      Sometimes possession is given to the buyer before the closing and other times the seller may need to stay on in the property after closing, and possession is given at a later date. Sometimes the day which is set for the closing and the day the buyer is scheduled to take possession is used as a negotiating tool. The buyer may allow the seller to stay on after the close of escrow, for example, in exchange for some reduction in the purchase price. Or, if the buyer needs to move in before closing, the seller will often let him take possession early. The seller may prepare an occupancy agreement, which is a form of a lease for the property. This lease agreement would cover the time which the buyer intends to occupy the property prior to the closing date. This type of lease is normally on a