Published on September 14, 2017

Adjustable Rate Mortgages

With an adjustable-rate mortgage (ARM), the loan will have an initial period where the rate, and your monthly payments, are fixed. After this period, the interest rate will change periodically (usually once a year) according to an index (a benchmark interest rate that reflects general market conditions) current at the time of the change and a predetermined margin (a fixed interest rate that is based on the loan program). Your payments may go up or down accordingly. Keep in mind that there are limits to the initial, periodic, and lifetime changes to your rate that prevent it from going above a certain percent. You may also see ARM loans referred to as a variable rate mortgage.

Assumptions and Disclaimers

Mortgage rates are based on current market rates and are subject to change without notice. The estimates produced by this calculator are based on the preferences and financial information you have entered so far and are not a commitment to lend. In addition, we assumed a rate lock of 30 days for Purchase scenarios and 45 days for Refinance scenarios. Not all products are available in all states and for all loan amounts. Other restrictions and limitations may apply.

The APR is the annual percentage rate and reflects the effective cost of your loan on a yearly basis, taking into account such items as interest, certain closing costs, discount points and loan-origination fees. For adjustable rate loans, the APR does not include the maximum interest rate of the loan. See additional disclosures above regarding ARMs .

Monthly payments do not include amounts for taxes and insurance, and thus the actual payment obligations will be greater.

Closing costs are estimated. Other fees may apply. For example, fees disclosed in a purchase contract, which are not lender fees but are required for the purchase of a property, are not included in the estimate of closing costs.

Remember, these are only estimates to help you understand your potential loan options based on the information you have provided so far. The actual terms of your loan will depend upon the specific characteristics of your loan transaction, your credit history, and your other financial characteristics. To get more accurate and personalized results, please proceed to the next step to complete and submit your application.

If you have any questions, call 844-846-7948 to talk with of our Loan Specialists.



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