If you anticipate a significant increase in your income or property value in the next several years, plan on staying in your home short-term, or would like to significantly lower your payment, an ARM might be right for you. As the name implies, Adjustable Rate Mortgages (ARMs) have interest rates that change at a pre-determined frequency. Federally insured FHA ARMs are also available!

• Save thousands in payments vs. a fixed rate loan during the initial period.
• Use the savings to pay down other debt.
• Get a cash-out refinance and put even more money in your pocket.
• Great option if you intend to refinance or sell your home.
• Put as little as 5% down. (No PMI available)

Hybrid ARMs

"Hybrid ARMs" are very popular, featuring an initial fixed-rate portion, which then changes to an adjustable rate for the remainder of the loan. They are typically represented as a 3/1, 5/1, 7/1, or 10/1. The first number indicates the time (in years) that the initial rate is fixed. The second number indicates how often the rate can adjust after the initial change.

For example: 5/1 ARM

Fixed rate for the first five years / followed by a rate adjustment once every year.

Interest Rate Caps

What happens after the fixed-rate period ends? Once your loan enters its adjustable-rate period, interest rate caps are put in place. They identify the maximum amount your rate can increase, both at the end of each adjustment period, and over the life of the loan as a whole. Contact one of our mortgage bankers today for details, and find the right loan for you!