OFCU Adjustable-Rate Mortgage Benefits
Lower Introductory Rates
Start with a lower interest rate than most fixed-rate mortgages during the initial fixed period.
Predictable Payments
Rate caps help limit the amount by which your interest rate can change, providing added peace of mind.
Flexible Financing Options
Ideal for borrowers planning to move, refinance, or increase income within a few years.
How a Credit Union Adjustable-Rate Mortgage Works
A credit union adjustable-rate mortgage begins with a fixed interest rate for a set period—such as 3, 5, or 7 years. After that initial period, the interest rate may adjust annually based on changes in a market index. Your monthly payment may increase or decrease depending on market conditions.
ARMs can be a smart option if you expect your income to grow or plan to sell or refinance before the rate adjusts significantly.
Features:
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Fixed introductory interest rate for a set initial period
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Annual rate adjustments after the introductory period
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Interest-rate caps that limit periodic and lifetime increases
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Available for home purchases and refinancing
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No prepayment penalties
Apply for an Adjustable-Rate Mortgage in 3 Easy Steps!
Step
1 |
Apply for an ARM
Conveniently apply for an ARM online by clicking the button below, calling us, or visiting a branch. |
Step
2 |
Loan Approval
We’ll review your application and reach out to you with a fast loan decision. |
Step
3 |
Finalize the Loan
Sign loan documents electronically or drop by a branch. |
★★★★★
“From the tellers to the loan officers, the customer service is outstanding! They make you feel like family, not just a customer.”
- Wanda M., Mexico, ME
Adjustable-Rate Mortgage FAQ
What is an adjustable-rate mortgage (ARM)?
An adjustable-rate mortgage (ARM) is a home loan that typically starts with a lower interest rate than a fixed-rate mortgage for an initial period of 1–7 years. After that period, the interest rate may be adjusted annually based on market conditions, which may result in an increase or decrease in your monthly payment.
How does the interest rate adjustment work?
Our credit union adjustable-rate mortgage uses a market-based index to determine rate adjustments. Your interest rate is calculated by adding a set margin to the index, helping ensure adjustments reflect current market conditions.
Is there a cap on how much my rate can increase?
Yes. To help protect you from large rate swings, our credit union ARMs include limits on interest rate changes. These include caps on how much the rate can adjust at each scheduled change, as well as a lifetime cap that limits how high the rate can go.
Who should consider an ARM?
An ARM may be a good option if your income is expected to increase in the future or if you plan to live in the home for only 3–5 years.
Can I refinance an ARM later?
Yes. Many borrowers refinance into another ARM or a fixed-rate mortgage, although refinancing typically involves additional closing costs.
Do your ARMs have prepayment penalties?
There’s no penalty for paying extra toward your loan or paying it off early.
How does an ARM differ from a fixed-rate mortgage?
A fixed-rate mortgage has the same interest rate for the life of the loan. In contrast, an ARM’s rate may change after the introductory period, which may cause your monthly payment to increase or decrease.
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More Ways to Borrow
Fixed-Rate Mortgage
Keep the same interest rate and monthly payment for the life of the loan, ideal for predictable budgeting and long-term stability.
Personal Loans
Cover planned or unexpected expenses with flexible terms and a straightforward application process.
Home Equity Line of Credit
Access funds as needed by borrowing against your home’s equity—useful for projects, larger expenses, or emergencies.