Adjustable-Rate Mortgages in Sioux Falls

An adjustable-rate mortgage (ARM) starts with a fixed interest rate for an introductory period. After that, your rate can go up or down with the market, which changes your monthly payment. Adjustable-rate describes the loan term, so ARMs are available across several loan types.

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Key Features of an ARM

Interest rate stays fixed for an introductory period of 5, 7, or 10 years
After that, the rate can rise or fall with market conditions
If rates drop, you may see the benefit in your new rate
You may be able to qualify for a higher loan amount
Available as a conventional, FHA, VA, or USDA loan

Is an ARM Right for You?

An ARM can be worth considering if rates are high when you buy, or if you expect to move or refinance before the fixed period ends. If you plan to stay in your home for the long term, a fixed-rate mortgage offers more predictability. Keep in mind that your payment can increase after the fixed period, so it helps to plan for that possibility.

Physician Loan Questions, Answered

Most buyers choose a fixed rate for its predictability. An ARM may fit when market rates are high, or when you know you will live in the home for fewer years than the fixed period.
A fixed rate locks in your interest rate for the life of the loan, so you always know what you will pay. That can be the best option when rates are low. When rates are high, or you plan to move or refinance, an ARM may be worth a look. A loan officer can compare both side by side.
Your rate adjusts periodically based on the market, so your monthly payment can go up or down. The new rate depends on market conditions at that time, so it is hard to predict ahead of time.
Yes. You can get a conventional, FHA, VA, or USDA ARM, just like you can with fixed-rate loans.