Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

How can the lower initial interest rate affect future ARM changes?

April 26, 2017affect arm changes future initial Interest rate lower

0

Posted

How can the lower initial interest rate affect future ARM changes?

1 Answer

0

Posted

The initial interest rate is usually discounted depending on the number of points paid at closing. Even if the index rate remains the same on the first ARM change, the interest rate could increase. This is caused by the introductory rate being discounted when the ARM loan is originated.