Standard ARMS and the Differences
A few options are available to fit your individual needs and your risk tolerance with the various market instruments.
ARMs with different indexes are available for both purchases and refinances. Choosing an ARM with an index that reacts quickly lets you take full advantage of falling interest rates. An index that lags behind the market lets you take advantage of lower rates after market rates have started to adjust upward.
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The interest rate and monthly payment can change based on adjustments to the index rate.
6-Month Certificate of Deposit (CD) ARM
This program has a maximum interest rate adjustment of 1% every six months. The 6-month Certificate of Deposit (CD) index is generally considered to react quickly to changes in the market.
1-Year Treasury Spot ARM
This program has a maximum interest rate adjustment of 2% every 12 months. The 1-Year Treasury Spot index generally reacts more slowly than the CD index, but more quickly than the Treasury Average index.
6-Month Treasury Average ARM
This program has a maximum interest rate adjustment of 1% every six months. The Treasury Average index generally reacts more slowly in fluctuating markets so adjustments in the ARM interest rate will lag behind some other market indicators.
12-Month Treasury Average ARM
This program has a maximum interest rate adjustment of 2% every 12 months. The Treasury Average Index generally reacts more slowly in fluctuating markets so adjustments in the ARM interest rate will lag behind some other market indicators.
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As one of Denver and Breckenridge Colorado's Top Mortgage Banking teams,
and as seasoned Wholesale Mortgage Bankers and Realtors, our goal is to help you with financing your home which begins with a personal commitment to you. With over 10 years of experience and closing over 110 million dollars of residential real estate we've helped people like you realize the dream of home ownership by tailoring a loan program that comfortably fits within your budget and not only finding a good home, the best home.
If you would like to obtain a loan prequalification with us at Colorado Mortgage Group.Click on the link to our Secure Loan Server for a Breckenridge Colorado Home Loan
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