Initial rates on a 5-1 ARM sometimes run a full percentage point or more below that of a comparable 30-year fixed rate mortgage, so the.

A 5/1 ARM or a fixed-rate mortgage it will depend on your situation. A fixed-rate mortgage is the most popular mortgage term used today. With a fixed-rate loan you’re able to lock in todays low interest rate for the life of the loan.

How a 5/1 ARM Mortgage Works The term 5/1 arm means that you will get five years of a fixed interest rate, followed by one-year increments of adjustable rates. This means that for the first five years of the mortgage, you are going to have the same interest rate and the same monthly mortgage payment.

Generally, the initial rate of a 5/1 ARM is lower than that of a 30-year fixed-rate mortgage, and is sometimes referred to as a "teaser" rate. After the initial five-year period, your interest rate.

Yes, that payment is much bigger than it would be on a 30-year mortgage, but it comes with some big advantages: You’ll save.

A 5/1 adjustable-rate mortgage, or ARM, is a mortgage loan that has a fixed rate for the first five years, and then switches to an adjustable-rate mortgage for the remainder of its term. Once a.

The 15-year fixed-rate mortgage increased two basis points to an average of 3.07%, according to Freddie Mac FMCC, +7.78% . The 5/1 adjustable-rate mortgage averaged 3.35%, dropping one basis point.

One common adjustable-rate mortgage is known as a 5/1 ARM. It has an initial fixed rate for five years before the interest rate starts adjusting. The rate can change every year for the remaining life of the loan.

Mortgage loans come in many varieties. One is the adjustable-rate mortgage, commonly referred to as the ARM. Unlike a fixed-rate mortgage, in which the interest rate is locked in for the life of the loan, an ARM is a mortgage that has an interest rate that changes.

Bankrate.com provides FREE adjustable rate mortgage calculators and other ARM loan calculator tools to help consumers learn more about their mortgages.

Refinance Mortgage Rates 15 Years

The 5/1 hybrid adjustable-rate mortgage, also known as a 5-year ARM, is a hybrid mortgage that offers an initial five-year fixed-interest rate before the rate becomes adjustable.

Refinance 30 Year Mortgage A 30-year refinance extends the time you take to repay from your current term back to 30 years. For example, if you currently have 15 years left on your mortgage, refinancing to a 30-year loan would allow you to make the repayments over a period twice as long.

Every mortgage charges interest in order to make the deal worth. To put this in perspective, let’s say you buy a $250,000 home with a 30-year 5/1 ARM, a 4% initial interest rate, and 20% down. Your.