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Adjustable Rate Mortgages

An Adjustable Rate Mortgage may be a good choice if you:

  • Want to maximize your buying power
  • Want to keep your payments lower during the first few years of your loan
  • Plan to stay move into a different home within the next ten years
  • Plan to pay-off your mortgage within the next 10 years
  • If, in the coming years, you expect your income to increase significantly

5/5 ARM

Best Choice If:

You want a loan with: • Very low initial payments, with stability for the first 5 years and then adjustments in 5 year increments • The benefits of both a Fixed and ARM product. 		Advantages:

• Interest rate stays fixed for first 5 years. Adjusts each 5 years thereafter, subject to caps • 5 year adjustments work well for planning and budgeting. • Allows for higher loan amount qualification and enhanced buying power 		Disadvantages:

• Interest rate and monthly payments will adjust in the future. • Over time, interest rate could rise above the current fixed rates.

10/6 ARM

Best Choice If:

You want:
  • A longer initial fixed period than the 5/6 ARM.
  • To keep your payments low.
  • To maximize the amount of loan you qualify for.
  • To stay in the home for less than 7 years.
  • The stability of a fixed monthly payment for first seven years of loan.
    		• Advantages:

  • Initial fixed interest rate for 10 full years. The rate adjusts every 6 months thereafter.
  • Allows for higher loan amount qualification and enhanced buying power.
  • Conversion to a fixed rate is available.
    		• Disadvantages:

  • The interest rate can increase dramatically after the first 10 years.
  • If it's likely you'll be moving out before 7 years has past, think about a 7 year balloon mortgage.

    • 10/6 ARM TIC

    Best Choice If:

    You want:
  • You need to qualify for the largest loan possible.
  • You wish to purchase a desirable property that may otherwise be unattainable; percentage ownership in high cost areas.
  • Single-family residences and large condominium projects are out of reach or undesirable
    		• Advantages:

  • Separate mortgage liability within a shared ownership structure.
  • Adjustable Rate Mortgage options offering competitive rates.
  • Fully-amortized repayments for the life of the loan with no pre-payment penalties
  • Desirable properties within larger cities that offers a sought after lifestyle and amenities
    		• Disadvantages:

  • Adjustable Rate Mortgages are subject to rate adjustments throughout the life of the loan (ask your Mortgage Loan Consultant for specifics and options)
  • Shared ownership requires shared expenses for the projects property taxes and insurance managed by an HOA

    • 3/6 ARM

    Best Choice If:

    You want:
  • The interest rate to stay constant for more than one year.
  • To keep your payments low. To maximize the amount of loan you qualify for.
    		• Advantages:

  • Initial fixed interest rate for 3 full years. The rate adjusts every 6 months thereafter.
  • Allows for higher loan amount qualification and enhanced buying power.
    		• Disadvantages:

  • It's riskier if you don't expect your income to increase over the initial five-year period to cover the change in monthly payment.
  • Interest rate can rise above the current fixed rates over time.

    • 5/6 ARM

    Best Choice If:

    You want:
  • A longer initial fixed period than the 3/6 ARM.
  • To keep your payments low.
  • To maximize the amount of loan you qualify for.
  • The stability of a fixed monthly payment for first five years of loan.
    		• Advantages:

  • Initial fixed interest rate for 5 full years. The rate adjusts every 6 months thereafter.
  • Allows for higher loan amount qualification and enhanced buying power.
    		• Disadvantages:

  • It's riskier if you don't expect your income to increase over the initial five-year period to cover the change in monthly payment.
  • Interest rate can rise above the current fixed rates over time.

    • 7/6 ARM

    Best Choice If:

    You want:
  • A longer initial fixed period than the 5/6 ARM.
  • To keep your payments low.
  • To maximize the amount of loan you qualify for.
  • The stability of a fixed monthly payment for first five years of loan.
    		• Advantages:

  • Initial fixed interest rate for 7 full years. The rate adjusts every 6 months thereafter.
  • Allows for higher loan amount qualification and enhanced buying power.
    		• Disadvantages:

  • It's riskier if you don't expect your income to increase over the initial seven-year period to cover the change in monthly payment.
  • Interest rate can rise above the current fixed rates over time.

    • 5/6 ARM TIC

    Best Choice If:

    You want:
  • You need to qualify for the largest loan possible.
  • You wish to purchase a desirable property that may otherwise be unattainable; percentage ownership in high cost areas.
  • Single-family residences and large condominium projects are out of reach or undesirable
    		• Advantages:

  • Separate mortgage liability within a shared ownership structure.
  • Adjustable Rate Mortgage options offering competitive rates.
  • Fully-amortized repayments for the life of the loan with no pre-payment penalties
  • Desirable properties within larger cities that offers a sought after lifestyle and amenities
    		• Disadvantages:

  • Adjustable Rate Mortgages are subject to rate adjustments throughout the life of the loan (ask your Mortgage Loan Consultant for specifics and options)
  • Shared ownership requires shared expenses for the projects property taxes and insurance managed by an HOA

    • 7/6 ARM TIC

    Best Choice If:

    You want:
  • You need to qualify for the largest loan possible.
  • You wish to purchase a desirable property that may otherwise be unattainable; percentage ownership in high cost areas.
  • Single-family residences and large condominium projects are out of reach or undesirable
    		• Advantages:

  • Separate mortgage liability within a shared ownership structure.
  • Adjustable Rate Mortgage options offering competitive rates.
  • Fully-amortized repayments for the life of the loan with no pre-payment penalties
  • Desirable properties within larger cities that offers a sought after lifestyle and amenities
    		• Disadvantages:

  • Adjustable Rate Mortgages are subject to rate adjustments throughout the life of the loan (ask your Mortgage Loan Consultant for specifics and options)
  • Shared ownership requires shared expenses for the projects property taxes and insurance managed by an HOA

    • Mortgage Rates

    The Loan Consultant feature determines the products and rates that match your needs.

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