Adjustable-rate Mortgage

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Rhonda a., renton

Adjustable Rate Loans

Rates as low as

APR Effective 1/19/2017*

3.871
%
APR

3/1 ARM

Adjustable after year 3

3.863
%
APR

5/5 ARM

Adjusts every 5 years

3.864
%
APR

7/1 ARM

Adjustable after year 7

*See important information about rates, fees and other costs

More bang for your buck

Adjustable-rate loans (ARMs) give you the advantage of increased buying power if you only plan on staying in your house a few years. An ARM may allow you to qualify for a larger home loan amount and get more house for your money, plus you'll have lower payments during the first years of your loan.

ARMs may be the best choice for you if:

  • You want to get more for your money
  • You want to keep payments lower during the early years of your loan
  • You plan to move within 10 years
  • You plan to pay off your mortgage within 10 years
  • You expect your income to increase significantly in the coming years

ARMs come in terms of 3/1, 5/5, 5/1 (standard and high-balance), 7/1, and 10/1.

*NEW* No origination fees

BECU is excited to announce yet another way we can save our members' money: NO origination fee on conventional fixed-rate or adjustable-rate mortgage home loans for purchase transactions**. No origination fee significantly reduces closing costs. And reducing cost is just one more way BECU can help members combat the skyrocketing prices in today's real estate market.

Email us to learn about BECU homes for sale.

Use this calculator to figure out if a fixed or adjustable rate home loan is best for you

Now let's take a look at your options:

Why choose this Pros Cons

 If you plan on staying in your home a short period of time

Initial fixed interest rate for seven full years

 Interest rate can rise above the current fixed rate over time

If you want a longer initial payment longer than 5 years

2% point annual adjustment after the initial fixed rate period and 6% interest rate cap over the life of the loan

 Riskier if you don't expect your income to increase over the initial seven year fixed rate period

 

Allows for higher loan amount qualification and enhanced buying power

Why choose this Pros Cons
 

You plan on staying in your home for a short period of time

Initial fixed interest rate for three full years and then rate adjusts annually thereafter

 It's riskier if you don't expect your income to increase over the initial three-year period to cover the change in monthly payment

You want the interest rate to stay constant for more than one year

Allows for higher loan amount qualification and enhanced buying power

Interest rate can rise above the current fixed rates over time

You want to keep your payments low

You want to qualify for higher loan amount with lower interest rates

Why choose this Pros Cons

 You plan to be in your home 5-10 years

 Rate is lower than a fixed-rate mortgage

 Rate is typically higher than a 5/1 ARM

 You want peace of mind knowing that your rate adjusts only every five years, not annually

Your rate and principal and interest payment adjust only every five years

You're looking for an initial low rate and payment, but afraid of annual rate increases

 Smaller number of rate adjustments during the life of the loan saves you more money

 Lower payments allow for more cash flow

 Flexible down payment options

Why choose this Pros Cons

 You plan on staying in your home a short period of time

 Initial fixed interest rate for five full years and the rate adjusts annually thereafter

 It's riskier if you don't expect your income to increase over the initial five year period to cover the change in monthly payment

 You want a longer initial fixed period than the 3/1 ARM

 Allows for higher loan amount qualification and enhanced buying power

Interest rate can rise above the current fixed rates over time

 You want to keep your payments low

 You want to qualify for higher loan amounts with lower interest rates

 The stability of a fixed monthly payment for first five years of loan

Why choose this Pros Cons

 For loan amounts from $424,000 to $729,750 for one-unit properties, $533,851 to $934,200 for two-unit properties, depending upon location of property

 Initial fixed interest rate for five full years and the rate adjusts annually thereafter

Requires a minimum Representative Credit Score of 680

 You plan on staying in your home a short period of time

 Allows for higher loan amount qualification and enhanced buying power

 It's riskier if you don't expect your income to increase over the initial five year period to cover the change in monthly payment

 

 You want a longer initial fixed period than the 3/1 ARM

 Interest rate can rise above the current fixed rates over time

 You want to keep your payments low

 You want to qualify for higher loan amounts with lower interest rates

 The stability of a fixed monthly payment for first five years of loan

Why choose this Pros Cons

 You plan on staying in your home a short period of time

 Initial fixed interest rate for seven full years and the rate adjusts annually thereafter

 It's riskier if you don't expect your income to increase over the initial seven-year period to cover the change in monthly payment

 You want a longer initial fixed period than the 5/1 ARM

 Allows for higher loan amount qualification and enhanced buying power

 Interest rate can rise above the current fixed rates over time

 You want to keep your payments low

 You want to qualify for higher loan amounts with lower interest rates

 The stability of a fixed monthly payment for first seven years of loan

Why choose this Pros Cons

 You want a longer initial fixed period than the 7/1 ARM

 Initial fixed interest rate for 10 full years and the rate adjusts annually thereafter

 The interest rate can increase dramatically after the first 10 years

 You want to keep your payments low

 Allows for higher loan amount qualification and enhanced buying power

 Small interest rate benefit vs. a 30-year fixed

 You want to qualify for higher loan amounts with lower interest rates

 Fixed-rate product may be a better choice if you think you may be in the home long term

 You plan to stay in the home for less than 10 years

 You want the stability of a fixed monthly payment for first ten years of loan

Why choose this Pros Cons
You need expanded options for qualifying income
Low down payment
Income limitation - not all members will be eligible
You need flexible credit qualifications
Flexible sources for funds for down payment and closing costs
Principal residences only (1-4 units)
If you have limited cash for a down payment
Flexibilities for income sources used to qualify

Need more information?

Just stop by your Neighborhood Financial Center, and we can answer your questions and help you find the home loan that's right for you.

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*Income limits may apply. Homeownership education at a cost of $75 (paid to Framework) required.   HomeReady is a trademark of Fannie Mae. Loans are subject to credit approval and other underwriting criteria.  Certain restrictions apply.  Home Loan programs, terms and conditions subject to change without notice.

**Offer effective with applications dated 4/15/2016, expiring 10/15/2016, and applies to purchase transactions only. The no-fee promotion does not currently apply to government (FHA, VA) loans.  Loans are subject to credit approval and other underwriting criteria, and not everybody will qualify. Certain restrictions apply. Home loan programs, terms and conditions are subject to change without notification.  BECU reserves the right to continue this offer indefinitely.