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  • Erma Houlding
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Created Aug 21, 2025 by Erma Houlding@ermahoulding1Maintainer

What is An Adjustable-rate Mortgage (ARM)?


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What is an adjustable-rate mortgage (ARM)?

An ARM is a mortgage loan that has a rate of interest that can change occasionally throughout the life of the loan. Most ARMs undergo change just as soon as each year. Some can have a fixed rates of interest for a defined number of years at the beginning of the loan and after that change each year after that. For instance a 3/1 ARM has a set rate for the very first 3 years of the loan and after that can alter as soon as a year after that.

Your loan documents will specify how often your rate can change as well as the minimum and maximum quantity it can alter each duration and just how much it can change over the life of the loan.

When the rate on an ARM changes, the payment will alter. That's why your Seattle Credit Union mortgage expert will make certain that you can manage your loan at the preliminary rate along with at the optimum rate. The last thing you want is to have your payment boost beyond what you can pay for to pay. Seattle Credit Union is committed to ensuring that our members don't discover themselves in this situation.

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