If you want to pay less money at the start of your loan, an Adjustable Rate Mortgage Loan (i.e., ARM) may be the right mortgage for you.
The ARM is great for people who plan to pay their mortgage off quickly, plan to live in the house for only a short time or foresee their income increasing in the next few years.
With an ARM, you’ll start with a low fixed interest rate for a set period of time — usually 5, 7 or 10 years. After that, your interest rate may change every 6 months or once a year, fluctuating with the market.
That means your monthly mortgage payment could go up or down twice a year. But your rate will never increase more than 5% of the original rate.
To qualify for a Jumbo Loan, you’ll need:
- General minimum 3.5% – 5% down payment
- Minimum qualifying FICO® Score of 640
- Debt-to-income ratio (DTI) of no more than 50%
- Maximum loan-to-value ratio (LTV) of 95%
Yes, you can refinance an adjustable-rate mortgage. When interest rates are low, refinancing an ARM can give you the stability of the same monthly payment for years to come. Refinancing could also help you consolidate debt or pay off your mortgage faster. Apply online or contact our experts to get started.