ARM Calculator (Adjustable-Rate Mortgage)
See the payment shock on an adjustable-rate mortgage. Enter the initial fixed rate and period, plus the rate you expect after it adjusts, to compare payments before and after the reset.
Your details
- Initial payment
- $1,610.46
- Monthly increase
- $336.61
- Balance at reset
- $275,486.20
Initial vs adjusted payment
- Initial payment
- $1,610.4683%
- Increase after reset
- $336.6117%
Formula
The initial payment amortizes the loan at the fixed rate over the full term. At reset, the remaining balance is re-amortized over the remaining years at the adjusted rate.
How it works
A 5/1 ARM keeps its rate for five years, then adjusts annually. If rates have risen, your payment can jump sharply. This shows the difference so you can judge whether you'd be comfortable — or plan to refinance before the reset.
Frequently asked questions
What does 5/1 ARM mean?⌄
The first number is the years the initial rate is fixed (5); the second is how often it adjusts afterward (every 1 year). Other common types are 7/1 and 10/1.
Is an ARM riskier than a fixed-rate loan?⌄
It can be. You get a lower initial rate, but your payment can rise at each adjustment. ARMs suit borrowers who expect to sell or refinance before the fixed period ends.
How high can the payment go?⌄
Real ARMs have periodic and lifetime rate caps that limit increases. This calculator uses the single adjusted rate you enter, so check your loan's caps for the true worst case.
Sources & methodology
Re-amortizes the remaining balance at the single adjusted rate you enter. Excludes rate caps, indexes, and margins — check your loan's terms for the true maximum.
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