Adjustable Rate Mortgage (ARM)
ARMs are normally available at lower initial rates with potential for rate and payment adjustments at 1, 2, 3, 5, or 10 year intervals. Future market conditions can influence rate changes; however, built in rate caps and margins provide a measure of security and limited increases over the life of the loan. ARMs can be amortized up to 30 years. Private mortgage insurance is usually required for loans with less than a 20% down payment.