An adjustable rate mortgage, or an "ARM" as they are commonly called, is a loan type that offers a lower initial interest rate than most fixed rate loans. The trade off is that the interest rate can change periodically, usually in relation to an index, and the monthly payment will go up or down accordingly.
Against the advantage of the lower payment at the beginning of the loan, you should weigh the risk that an increase in interest rates would lead to higher monthly payments in the future. It's a trade-off. You get a lower rate with an ARM in exchange for assuming more risk.
For many people in a variety of situations, an ARM is the right mortgage choice, particularly if their income is likely to increase in the future or if they only plan on being in the home less than five to seven years.
5|5 Home Loan
Our 5|5 Adjustable Rate Home Loan is made for people needing an affordable home loan and who may not need a 30-year commitment. Enjoy:
Great rates with credit toward your closing costs*
Up to $2 million financing for purchases or refinances
Maximum 30-year term
Rate subject to change every 5 years
Maximum interest rate adjustment of 2 percent every five years or 5 percent over the life of the loan
Want flexibility and stability in one? On average, most people move or refinance every five-to-seven years.
More secure than a typical adjustable-rate loan, our 5|5 Home Loan offers lower interest rates than a traditional fixed-rate loan. You’ll enjoy five years of low, locked-in payments, then an adjustment only every five years after that.1
Want more information on other low down payment options?
Additional Adjustable Mortgage Loans
We also have additional adjustable mortgage loans such as the 3|1 ARM, 5|1 ARM and 7|1 ARM. Like the 5|5 Mortgage you’ll enjoy low, locked-in payments for 3 years, 5 years or 7 years, then an adjustment every year after that.
Want more detailed information on adjustable-rate mortgages? Click here
Mortgage questions? Check out our Mortgage Resource Center
* Closing Cost credit cover the loan processing fees of $1095 in CA and $895 in NC
 The rate on this mortgage can change every five years. Available mortgage rates and terms are subject to change at any time. Maximum loan amount $2 million. Available only in properties located in California or North Carolina. Other restrictions apply.