Benefits of an Adjustable Rate Mortgage

 An adjustable-rate mortgage (ARM) is a type of home loan where the interest rate applied on the outstanding balance varies throughout the life of the loan. The initial interest rate is typically fixed for a period of time, after which it resets periodically, often every year or month, based on changes in a corresponding financial index that's associated with the loan. The rate changes are usually determined by adding a margin to the index.

Benefits of Adjustable-Rate Mortgages:

1. Lower Initial Rates: ARMs often start with lower interest rates compared to fixed-rate mortgages, which can make monthly payments more affordable in the early years.
2. Potential for Decreasing Rates: If market interest rates decline, your rate and payments may decrease during adjustment periods.
3. Savings: The lower initial interest rate can result in significant savings on interest payments during the fixed-rate period.
4. Flexibility: ARMs can be advantageous for borrowers who plan to sell or refinance their home before the adjustable period begins, allowing them to take advantage of lower rates without the risk of future rate increases.
5. Higher Loan Amounts: The lower initial payments can allow borrowers to qualify for larger loan amounts.

For more information about any of our ARM loan options please feel free to contact us. Our experience team of mortgage advisors is ready to help guide you to find the perfect loan to meet your needs. 

Park Place Financial Group

Joe Costa/Marni Wolf

402 West Broadway

Suite 400

San Diego, CA 92101

619.990.7552

info@parkplacefg.com

www.parkplacefg.com