ARMs

Adjustable Rate Mortgages generally offer lower interest rates than Fixed Rate loans for an initial period of between 1 and 10 years. ARM loans adjust periodically according to financial market conditions. For protection in the event that interest rates rise dramatically, there are limits or "rate caps" on the amount that your interest rate can rise or fall at each adjustment period. There is also a lifetime cap on adjustable rate loans which establishes the maximum interest rate that your loan could ever reach.

Consider an Adjustable Rate Mortgage if you:

• Want lower payments than a fixed rate mortgage
• Want to buy a more expensive home than you can with a fixed rate mortgage
• Plan on selling or refinancing your home within the next 10 years
• Expect your income to increase in the future such that you could afford a potential increase in your monthly payment