How ARM loans work
An adjustable-rate mortgage (ARM) has a fixed-interest rate for the first 5, 7 or 10 years depending on your loan. After the initial period, the rate may adjust every 6 months for the remainder of the loan.
These examples are based on a 780 credit score, 30-year, $350,000 loan for a single-family home, primary residence with 20% down in Florida.
Keep in mind, the ARM loan examples used in the rate table are also based on a 30-year loan term.
5 year /6 month 30 year ARM
| Payments | Estimated Interest Rate | Estimated Monthly Payment |
|---|---|---|
| 1 - 60 | 8.000% | $2,568.18 |
| 61 - 66 | 9.500% | $2,907.18 |
| 67 - 360 | 10.000% | $3,022.43 |
Initial Interest Rate /
APR : 8.000%/7.929%
First Adjusted Interest Rate : 1.500%
Subsequent Adjusted Interest Rate : 0.500%
Maximum Lifetime Rate : 13.000%
Estimated Maximum Monthly Payment : $3,739.11
Current Index Rate : 4.632%
Margin : 2.750%
First Adjusted Interest Rate Cap : 2.000%
Subsequent Adjusted Interest Rate Cap : 1.000%
Lifetime Cap : 5.000%
7 year /6 month 30 year ARM
| Payments | Estimated Interest Rate | Estimated Monthly Payment |
|---|---|---|
| 1 - 84 | 7.250% |
$2,387.62 |
| 85 - 90 | 10.250% |
$3,024.53 |
| 91 - 360 | 10.850% |
$3,157.33 |
Initial Interest Rate / APR : 7.250%/7.665%
First Adjusted Interest Rate : 3.000%
Subsequent Adjusted Interest Rate : 0.600%
Maximum Lifetime Rate : 12.250%
Estimated Maximum Monthly Payment : $3,480.02
Current Index Rate : 4.632%
Margin : 2.750%
First Adjusted Interest Rate Cap : 5.000%
Subsequent Adjusted Interest Rate Cap : 1.000%
Lifetime Cap : 5.000%
10 year /6 month 30 year ARM
| Payments | Estimated Interest Rate | Estimated Monthly Payment |
|---|---|---|
| 1 - 120 | 7.625% | $2,477.28 |
| 121 - 126 | 10.625% | $3,066.82 |
| 127 - 360 | 11.225% | $3,189.16 |
Initial Interest Rate / APR : 7.625%/7.910%
First Adjusted Interest Rate : 3.000%
Subsequent Adjusted Interest Rate : 0.600%
Maximum Lifetime Rate : 12.625%
Estimated Maximum Monthly Payment : $3,487.71
Current Index Rate : 4.632%
Margin : 2.750%
First Adjusted Interest Rate Cap : 5.000%
Subsequent Adjusted Interest Rate Cap : 1.000%
Lifetime Cap : 5.000%
Last Updated: 12/3/2024