The interest rate at the inception of an Adjustable Rate Mortgage (ARM) is fixed for a pre-determined period of time. At the end of that time, the rate fluctuates for the remaining term of the loan. This is often a lower monthly payment initially and there is a cap above which payments can not go.
An ARM is a viable option for borrowers that:
- Plan to stay in the home for a short period of time
- Homeowners that plan on refinancing in the near future
Call us now and see if an ARM is the right product to fit your needs.