5 Year Adjustable Rate Mortgages from eLEND
With a 5 year ARM, homeowners can enjoy an introductory fixed rate for the first 5 years of their mortgage. In most cases, the introductory fixed interest rate on a 5 Year ARM is considerably lower than those associated with conventional fixed rate and FHA mortgages. After the introductory fixed rate period is up, the interest rate will be subject to periodic adjustment. A 5 Year ARM could be a great option for home buyers who do not plan on staying in their home more than 5 years.
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A 5/1 ARM Could Be Right for You If…
- You want to save money during the first five years of homeownership by having a low, fixed rate
- You anticipate an increase in your household income within the next five years
- You are financially secure enough to handle a higher mortgage payment, should the rate adjust higher before you are able to sell or refinance
A 5 Year ARM (5/1 ARM) offers an introductory fixed interest rate for the first 5 years of your mortgage. This rate is usually considerably lower than those offered on conventional fixed rate mortgages or FHA loans. However, once the 5 year fixed rate period is up, the mortgage rate on the 5 Year ARM will be subject to change, based on the market. The rate could go up, or it could go down; however, it may only change once per year for the remainder of the mortgage. There are also rate caps set in place for ARM loans to keep the rate from rising beyond a certain point. Make sure you discuss the rate caps with your lender and make sure you feel comfortable making the payments, should they rise due to a higher rate.