Get a mortgage rate as low as 2.50% (2.975% APR) with our adjustable rate mortgage.
- Do you want to significantly reduce the cost of your mortgage?
- Do you plan to move or refinance in the next 5, 7 or 10 years?
- Do you want the lowest rate available?
If you answered “Yes” to any of these questions, an ARM might be right for you! You’ll get the lowest rate we offer and save thousands over a traditional fixed-rate mortgage during the initial fixed-rate period with our adjustable rate mortgage.
An adjustable-rate mortgage offers an introductory period in which you pay a lower interest rate than with a fixed loan; after that, the rate can fluctuate up or down. With rates near historic lows, the safety of locking in a fixed rate appeals to many borrowers. But they're paying a premium for that security: The spread between rates on 30-year fixed-rate mortgages and the most popular ARMs now stands at about one percentage point, more than double the difference just five years ago.
That means that homeowners who are planning to either move or pay off their mortgage over the next few years can save big with an ARM. Take, for example, a homebuyer who plans to pay down an $800,000 mortgage. Currently the rate on the fixed portion of a 5/1 ARM — which is guaranteed for the first five years and adjustable once a year thereafter — is around 3%. In a typical 5/1 ARM, the maximum increase during the sixth year is five percentage points above the initial rate. Alternatively, our hypothetical borrower could opt for a 30-year mortgage that locks in an annual rate of about 4%
Adjustable rate mortgage qualification requirements
- Refinance up to 95% of your primary home’s value
- Buy a home with as little as 5% down (primary home)
How an adjustable rate mortgage works
- FHA and VA ARMs are also available for those that want the flexible guidelines and security of an FHA loan
- Interest rates are fixed for a period of five or seven years. After the fixed rate period, your interest rate can adjust up or down depending on market conditions
- Rate adjustments are capped at 5% above your initial rate and 2% or 5% per adjustment period. This means if your initial interest rate is 3.99%, your rate will never be higher than 8.99%, and will never rise more than 2% per year
- Your actual payment will vary based on your situation and the current interest rates when you apply
- Pay your mortgage at any time without pre-payment penalties