Adjustable Rate Mortgages

Click here to learn more about Adjustable Rate Mortgages, also knows as an ARM.
An Adjustable Rate Mortgage, also known as an "ARM," are mortgages that offer a lower fixed rate term for a determined amount of years. Typical ARMs are offered in fixed terms of 3, 5, 7, or 10 years and are amortized over a full 30 year mortgage. After the fixed period time they can adjust up or down at certain intervals based on a current index they are tied to plus a preset margin.

ARMs become attractive to homeowners who looking for short term financing. They can take advantage of the lower rate and payment during this time and usually will sell or refinance their home before the fixed term is up.

While interest rates are still historically low, it is not common for borrowers to obtain these types of mortgage loans. But in the past when rates were much higher Adjustable Rate Mortgages were attractive and allowed home owners to qualify for a higher mortgage amount.

Call Cornerstone Mortgage at (661) 370-0600 for more information on obtaining your next mortgage loan.
 
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