What is the ARM adjustment period?
The period between one rate change and the next is called the adjustment period. With most ARMs, the interest rate and the monthly payment can change or adjust every six months, once a year, after three years, every three years, five years, seven or ten years. For example, a loan with an adjustment period of one year is called a “one-year ARM” and the interest rate and payment can change once every year. The frequency of ARM adjustments is established at the time of application and the terms are outlined on the ARM note. Our Informational Rates page provides you with today’s rates for several of the leading indices for ARM adjustments and conversion.
The frequency with which your interest The premium which a borrower must pay a lender in return for use of the lender\’s money.’); return false”>interest rate may change is called the initial note adjustment period. The most common ARM adjustment periods are every 6 months or every 12 months. The frequency of ARM adjustments is established at the time of application and the terms will be outlined in your ARM note. There are ARM products available where the initial interest rate will be fixed for the 1st, 3rd, 5th, 7th or 10th years, and then adjust annually thereafter for the life of the loan. There are also loan products available where the interest rate changes monthly, but the principal and interest payment change annually.
