Adjustable Rate Mortgage (ARM)
An adjustable rate mortgage generally features an initial interest rate that may be lower than that of a fixed-rate mortgage, which can result in lower initial payments to help offset the costs of a down payment, closing costs and other expenses. Then, the rate adjusts after a set period up to a certain limit.
Features
- Amortization periods: up to 30 years
- Payment of principal and interest adjusts based on a preselected index plus a margin with rate-cap adjustments
- Maximum amount: $417,000