ARMs (Adjustable Rate Mortgages)

• Navy Federal's Adjustable Rate Mortgages begin with a low, constant rate, then adjust upward or downward regularly according to an index. PMI is required if loan-to-value ratio is over 80%.
• Interest-Only mortgage option available (terms of 3/1, 5/1, 7/1).
• Lower loan payment in early years may let you afford a larger loan.
• Interest rate adjustments are capped at the following limits:

View payment example.

ARMs Glossary

2/2 ARM

A 2/2 ARM is an Adjustable Rate Mortgage that has an initial interest rate for the first 2 years, and thereafter adjusts every two years. The adjustment is based on (or "indexed to") another rate-often a Libor-based rate.

3/1 ARM   (Interest-Only option available)

A 3/1 ARM is an Adjustable Rate Mortgage that has an initial interest rate for the first three years, and thereafter adjusts each year. Each annual rate adjustment is based on (or "indexed to") another rate—often on a Libor-based rate.

5/1 ARM   (Interest-Only option available)

A 5/1 ARM is an Adjustable Rate Mortgage that has an initial interest rate for five years, and thereafter adjusts each year. The adjustment is based on (or "indexed to") another rate—often a Libor-based rate.

7/1 ARM   (Interest-Only option available)

A 7/1 ARM is an Adjustable Rate Mortgage that has an initial interest rate for seven years, and thereafter adjusts each year. The adjustment is based on (or "indexed to") another rate—often a Libor-based rate.