Posted on: 26th Aug, 2006 08:32 am
what does it mean if we have a 3/27 ARM?
Hi K,
3/27 ARM is a 30 year amortized loan with the intial rate remaining fixed for the first 3 years. After 3rd year, the rate adjusts and varies at regular intervals till the end of the loan term.
3/27 ARM is a 30 year amortized loan with the intial rate remaining fixed for the first 3 years. After 3rd year, the rate adjusts and varies at regular intervals till the end of the loan term.
Hi,
A 3/27 ARM means that you have an adjustable rate mortgage with a total loan period of 30 years. The low initial interest rate will remain fixed for the first 3 years. Hence you don't have to worry much about the payments in these 3 years. But at end of 3 years, the interest rate will adjust itself with respect to the index that is linked to your ARM.
The interest rates will continue to adjust for the remaining loan period, that is, 27 years. The adjustment period for this ARM will however depend on the agreement between you and the lender.
Thanks,
Caron.
A 3/27 ARM means that you have an adjustable rate mortgage with a total loan period of 30 years. The low initial interest rate will remain fixed for the first 3 years. Hence you don't have to worry much about the payments in these 3 years. But at end of 3 years, the interest rate will adjust itself with respect to the index that is linked to your ARM.
The interest rates will continue to adjust for the remaining loan period, that is, 27 years. The adjustment period for this ARM will however depend on the agreement between you and the lender.
Thanks,
Caron.