Special Mortgage Promotions
Offering Our Members Unbelievable Mortgage Specials
5/1 Adjustable Rate Mortgage (ARM)
| What is a 5/1 ARM? |
| A 5/1 ARM is a mortgage in which the rate is fixed for 5 years. In the sixth year, the loan becomes an ARM. The new rate is determined by an economic index and is added to a pre-determined margin to arrive at your new monthly rate. The loan is fully amortized (or paid off) in 30 years if the normal payment schedule is followed. |
| Who should get a 5/1 adjustable rate mortgage? |
| A 5/1 ARM is popular when houses appreciate quickly, people who do not expect to stay in a home for long, or for those expecting to refinance before the rate adjusts. |
| What are the advantages of 5/1 ARM? |
| A 5/1 ARM’s advantages are the initial rates are lower than fixed-rate mortgages, you can qualify for a higher loan amount with an ARM (due to the lower initial interest rate), and if the interest rate drops, your monthly payments will also drop. |
1 A point is one percent of the loan amount. Paying extra points at closing can lower the interest rate on the loan. For example, two points on a $100,000 mortgage would be $2,000. Points may be tax-deductible, depending on your situation. Check with a tax adviser.
2 The Annual Percentage Rate (APR) for this 5/1 ARM is 1.7912%.The ARM rate will adjust based on the index and margin. The adjustment cap is 2.00%. The lifetime cap is 6.00%. The margin is 2.75%. The maximum loan amount is $600,000. The rates are subject to change at any time without notice. Rates subject to loan approval and membership qualification. These promotional rates are for a limited time only.
