Purchase
Adjustable-Rate Mortgage (ARM)
A lower starting rate for a set period, then adjusts based on the market.
What it is
An ARM starts with a fixed rate for a set number of years, then adjusts periodically based on a market index, within limits called caps.
Who it's great for
- Buyers who expect to move or refinance
- Higher loan amounts
- Anyone comfortable with some future change
Key features
- Fixed intro period (5, 7 or 10 years)
- Rate caps limit changes
- Often lower starting payment
General requirements
- Qualifying is based on program rules, sometimes at a higher rate
- Income and credit documentation
- Down payment per program
General guidelines only. Every loan is subject to credit approval, underwriting and property review. Not a commitment to lend.
Common Questions
What happens after the fixed period?
The rate adjusts based on an index plus a margin, within set caps.
How much can it go up?
Caps limit each adjustment and the lifetime increase. I'll show you the worst case in writing.
Can I refinance later?
Yes, though future rates aren't guaranteed.
Who should avoid an ARM?
Anyone who wants total payment certainty for many years.
Is a Adjustable-Rate Mortgage (ARM) Right for You?
Let's talk about your situation. Honest answers, no pressure.
NMLS #172296 | Licensed in Colorado