### Category Thoman54341

25 Aug 2013 The initial rate on a five-year adjustable-rate mortgage, for example, ranged from 3 percent to 3.5 percent as of last week, depending on the  Use our adjustable rate mortgage (ARM) calculator to see how interest rate assumptions will impact your monthly payments and the total interest paid over the life

An adjustable-rate mortgage (ARM) is a type of mortgage in which the interest rate applied on the outstanding balance varies throughout the life of the loan. With an adjustable-rate mortgage, the initial interest rate is fixed for a period of time, after which it resets periodically, often every year or even monthly. This means the rate can change a full 6% once it initially becomes an adjustable-rate mortgage, 2% periodically (with each subsequent rate change), and 6% total throughout the life of the loan. And remember, the caps allow the interest rate to go both up and down. An amount paid to the lender, typically at closing, in order to lower the interest rate. Also known as mortgage points or discount points. One point equals one percent of the loan amount (for example, 2 points on a \$100,000 mortgage would equal \$2,000). The interest rate changes on an adjustable rate mortage (ARM) during adjustment periods specified in your loan documents. Your interest rate may have a fixed period where it does not change followed by adjustements on a regularly scheduled basis. For example, the interest rate on a mortgage could be fixed for 2 years followed by adjustments every 6 months. Interest Rate Caps

## ARM loans are designed for short-term buyers, and the shorter the initial lock-in period is, the lower the initial interest rate will be. For example, if you choose a

Mortgage lenders use a special series of number structures to tell you about your loan and interest periods. For example, the most common type of ARM is a 5/1  Find the best 5/1 ARM loans and understand if an adjustable-rate mortgage makes For example, a 5/1 ARM has an initial interest rate that remains fixed for the  For example: a three-year introductory period. Adjustment Period: how frequently the bank can adjust your interest rate once the introductory period is over and  This calculator helps you compare a fixed rate mortgage with both fully- amortizing and interest-only adjustable rate mortgages (ARMs). With mortgage rates near  Using a mortgage calculator you can calculate this simple example. Let's say you buy a house, and the purchase price is \$240,000. You put down 10%, or \$24,000   level-payment fixed-rate mortgage, which may be prepaid on demand. The interest rate adjusts on a regular schedule (for example, once per year or.

### An "adjustable-rate mortgage" is a loan program with a variable interest rate that For example, you may see mortgage programs advertised like a 5/25 ARM or

20 Apr 2014 If an ARM has a reduced interest rate for an initial period -- for example, the first 2 years or first 5 years of the loan -- the rate and the monthly