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Adjustable Rate Mortgage Calculator
Adjustable Rate Mortgage CalculatorAdjustable rate mortgages can provide attractive interest rates, but your payment is not fixed. This calculator helps you to determine what your adjustable mortgage payments may be.
Definitions
Adjustable Rate Mortgage (ARM)
This calculator shows a fully amortizing ARM which is the most common
type of ARM. The monthly payment is calculated to payoff the entire
mortgage balance at the end of the term. The term is typically 30 years.
After any fixed interest rate period has passed, the interest rate and
payment adjusts at the frequency specified. A Fully Amortizing ARM will
also have a maximum rate that it will not exceed. Below is a list of
the most common types of Fully Amortizing ARMs.
| Common Adjustable Rate Mortgages |
| ARM Type |
Months Fixed |
| 10/1 ARM |
Fixed for 120 months, adjusts annually
for the remaining term of the loan. |
| 7/1 ARM |
Fixed for 84 months, adjusts annually
for the remaining term of the loan. |
| 5/1 ARM |
Fixed for 60 months, adjusts annually
for the remaining term of the loan. |
| 3/1 ARM |
Fixed for 36 months, adjusts annually
for the remaining term of the loan. |
| 1 year ARM |
Fixed for 12 months, adjusts annually
for the remaining term of the loan. |
Mortgage amount
Original or expected balance for your mortgage.
Starting interest rate
Initial annual interest rate for this mortgage.
Term in years
The number of years over which you will repay this loan. The most common mortgage
terms are 15 years and 30 years.
Interest rate cap
This is the highest interest rate allowed by your mortgage. Your actual interest
rate will not be adjusted above this rate.
Months before first adjustment
This is the number of months that the interest rate is fixed. After this period,
the interest rate will be subject to rate adjustments. If you enter zero in
this field, we assume that the rate will begin making adjustments after initial
period of time between adjustments has passed. If any number other than zero
is entered, the first adjustment will take place at that time, and adjustments
will happen at the frequency entered in the "months between adjustments" field.
Expected adjustment
The amount you believe that your mortgage's interest rate will change. This
amount will be added to or subtracted from your interest rate.
Months between adjustments
The number of payment periods between potential adjustments to your interest
rate. The most common is 12 months, which means your payment could change at
most once per year.
Starting monthly payment
Monthly principal and interest payment (PI) based on your beginning balance
and starting interest rate.
Total payments
Total of all monthly payments over the full term of the mortgage. This total
payment amount assumes that there are no prepayments of principal.
Total interest
Total of all interest paid over the full term of the mortgage. This total
interest amount assumes that there are no prepayments of principal.
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