5/5 ARM

Home Loan Header Graphic

 

5/5 Adjustable Rate Mortgage

Our Adjustable Rate Mortgage is different than a typical ARM in that your Annual Percentage Rate will stay the same for the first 5 years of the loan versus changing every year. After the initial 5 years, the rate will only adjust every 5 years for the life of the loan, depending on the market. Compared to a Fixed Rate home loan, the 5/5 ARM offers a lower APR initially, which can increase your buying power. If you are looking for the lowest rate ARM possible, you may want to consider a 5/1 ARM, which typically has a lower APR than the 5/5 ARM.

Best Choice If:

  • The home you are looking to purchase is under $424,100.
  • You are looking to enhance your buying power, and you want to take advantage of a lower initial rate versus a Fixed Rate loan, but at the same time, want to know your rate will be stable for 5 year periods.
  • You want to keep your rate, which affects monthly payments, low at the beginning of your loan.
  • If you want an ARM, but you value stable payments over the lowest initial rate possible. If you are looking for the lowest APR, you may want to consider a 5/1 ARM; however, the APR can change annually after the first 5 years versus a 5/5 ARM where the rate can only adjust every 5 years.

Other Features:

  • Rate caps = 2% per adjustment and 5% over the lifetime of the loan. A rate cap is a limit on how much the rate can change at the end of each adjustment period over the life of the loan.
  • Index = 1 Year LIBOR
  • Margin = 2.000%
  • Conversion to a Fixed Rate home loan is not currently available.

An example APR for a 5/5 Year ARM loan is 3.125%. An example monthly mortgage payment is $428. The example quotes are based on a property value of $200,000 and a loan amount of $100,000 for 1st mortgage options and a $10,000 2nd mortgage. The Annual Percentage Rates (APR) stated is an estimate and is intended for informational use only. Your actual APR may vary based on your actual loan amount. Please visit the Loan Consultant for additional information about our rates and fees. Rates are subject to change without notice. Your actual rate and/or points may be different, as many factors are evaluated for a loan approval.