Loan Options
Adjustable Rate Mortgage (ARM)
Adjustable Rate Mortgage
An adjustable-rate mortgage (ARM) is a type of mortgage in which the interest rate applied on the outstanding balance varies throughout the life of the loan. With an adjustable-rate mortgage, the initial interest rate is fixed for a period of time. After this initial period of time, the interest rate resets periodically, at yearly or even monthly intervals. ARMs are also called variable-rate mortgages or floating mortgages.
Hybrid ARM
A hybrid ARM offers potential savings in the initial, fixed-rate period. Common ARM terms are 3/1, 5/1, 7/1 and 10/1. With a 5/1 ARM, for example, your introductory interest rate is locked in for five years before it can change. That gives you five years of predictable, low payments.
Flexibility
An ARM can be a good idea if your life is likely to change in the next few years — for instance, if you plan to move or sell the house. You can enjoy the ARM’s fixed-rate period and sell before it ends and the less-predictable adjustable phase starts.
The interest rate for ARMs is reset based on a benchmark or index, plus an additional spread called an ARM margin.
- Often have lower interest rates than fixed-rate mortgages
- Lower rate means you might be able to pay more principal every month
- Rates can go down lower
ARM Cons
- Rates can rise over time
- Certain caps can cause negative amortization
- Your monthly payments can fluctuate
- You don't know what your financial situation will be when rates change
Get Started on Your Journey Home
Knowledge Base
Get Your Cash Back
Paying cash for a home has benefits. Take advantage of being a cash buyer to give the seller confidence the transaction will close quickly and …
Refinance & Renovate
If you are having a difficult time finding a new home with limited inventory in today’s market, have you considered renovating your current home? We …
6 Tips for Saving For Your Down Payment
Before you can make the transition from renting your home to owning your home, you will need to have a down payment, typically 3 to …
Credit Tips for First Time Homebuyers
When applying for a mortgage loan, your credit will be one of the key factors in whether you’re approved, and it will help determine your …
Have You Heard? Refinance and Remove FHA Mortgage Insurance
Refinancing your FHA loan to a conventional mortgage may clear room in your monthly budget, especially with interest rates hovering at historic lows. Removing FHA …
Homebuyer Tips
Our goal is to make your home buying experience as seamless as possible. We have highlighted some key guidelines to help keep your finances in …
Appraisal Methods
When you’re buying a home using a mortgage, refinancing your existing mortgage or selling your home to anyone other than an all-cash buyer, the home …
To Do After Closing
After you finish signing at the closing of your new home, you’re handed the keys and the house is officially yours! But, there are some …
Why Use a Local/Regional Mortgage Lender?
Buying a home will likely be the biggest purchase you will ever make in your life. Finally moving into your new home will be a …
Homeowners Insurance
Homeowners insurance or home insurance is typically required for anyone who takes out a mortgage to buy a home. Prior to closing on a mortgage, …
Tax Deduction Documents For A Home Mortgage
When you buy a home, there may be tax deduction benefits. These include possible mortgage interest and points you paid to receive a lower interest …
5 Important Questions When Choosing Your First Home
Buying your own home can be exciting and frightening at the same time. George Mason Mortgage suggests considering the following questions when choosing your first …
Moving Checklist
We looked everywhere and found what we think is the most comprehensive moving planner from moving.com. Their moving planner is set to begin prior to …
George Mason Mortgage, We’re Here For You
The COVID-19 (also known as “coronavirus”) situation has quickly changed our daily lives. George Mason Mortgage recognizes our entire country is dealing with constant uncertainty …
Your First Step: Budget & Affordability
One of the first steps to get started on this exciting journey is planning ahead. Here are some tips to determine how much home you …
Homebuyer Options
Low Down Payment Programs & Grants George Mason Mortgage has the program options to fit your story and our experienced mortgage professionals will help find …
The Lowdown on Down Payments & Mortgage Insurance
The 20% Down Payment Myth Many first time home buyers believe they must put 20 percent down on a home. But that is far from …
9 Tips for Purchasing Your First Home
Beginning the home buying process can be a very exciting, yet nerve-wracking experience for anyone starting off. These tips will help answer some questions to …
Your Journey Home
Knowing the path we are about to travel together helps the journey go more smoothly. Before you get started, we have outlined some important highlights …
Is Now a Good Time to Buy?
Navigating the Housing Market through the Pandemic What is traditionally the peak of the home-buying season was upended this year by COVID-19, making this season …
Refinancing 101
Rates have hit an all-time low and have left homeowners scrambling to refinance their mortgages. You have most likely heard in casual conversations with friends …
Is it Time to Refinance?
Refinancing is a big step and takes the same time and effort as when you applied for your loan in the first place. However, when …