SCCU Adjustable Rate Mortgage Loans (ARM)

In addition to standard programs that adjust annually, our programs provide an initial fixed rate from three to ten years before the rate adjusts at all. These options are best for those who want added payment stability and lower monthly expense. With our exclusive interest rate guarantee, you can relax knowing that if our rates drop when it's time to close, we'll pass on the savings!*

1/1 Year ARM

Advantages:

  • Interest rate stays fixed for first year, adjusting annually thereafter
  • Very low initial payments
  • Allows for higher loan amount qualification and enhanced buying power
  • Conversion to a fixed rate is available

Best Choice If:

  • Want to maximize your buying power
  • Want the benefits of both a Fixed and ARM product
  • Want to keep your payments lower during the first few years of your loan
  • Plan to move or pay-off your mortgage within the next ten years
  • If, in the coming years, you expect your income to increase significantly

ARM Features

  • Treasury Indexed ARM Interest and payment adjustment occurs every 12 months
  • Rate caps = 2% per annual adjustment and 6% over the lifetime of the loan
  • Index = 1 yr. t-bill
  • Margin = 2.75%

For example, on a 1/1 1-Year Constant Maturity Treasury Index (1-Year CMT) Adjustable Rate Mortgage (ARM), the interest rate and payment are fixed for the first year of the loan. The interest rate and payment may adjust every twelve months thereafter and may not increase or decrease more than 2.0% at each twelve-month adjustment. The interest rate cannot increase more than 5% over the term of the loan. For a 1/1 1-Year CMT ARM for $200,000 with a 30-year term and an initial interest rate of 4.043% APR, repayment will consist of 12 monthly payments of $926.24. If the interest rate were to increase by the maximum five percentage points to 9.043% APR, then the monthly payment would increase from $926.24 to a maximum of $1,555.65 in the second year. Other rates and terms are available. The terms used in this example are for illustrative purposes only and the actual terms you receive may be different depending on your individual circumstances.

3/1 Year ARM

Advantages:

  • Interest rate stays fixed for first 3 years, adjusting annually thereafter
  • Allows for higher loan amount qualification and enhanced buying power
  • Conversion to a fixed rate is available

Best Choice If:

  • Want to keep your payments lower during the first few years of your loan
  • Plan to move or pay-off your mortgage within the next ten years
  • Want the benefits of both a Fixed and ARM product

ARM Features

  • Treasury Indexed ARM Interest and payment adjustment occurs every 12 months after initial fixed rate period.
  • Rate caps = 2% per annual adjustment and 6% over the lifetime of the loan.
  • Index = 1 yr. t-bill
  • Margin = 2.75%

For example, on a 3/1 1-Year Constant Maturity Treasury Index (1-Year CMT) Adjustable Rate Mortgage (ARM), the interest rate and payment are fixed for the first three years of the loan. The interest rate and payment may adjust every twelve months thereafter and may not increase or decrease more than 2.0% at each twelve-month adjustment. The interest rate cannot increase more than 5% over the term of the loan. For a 3/1 1-Year CMT ARM for $200,000 with a 30-year term and an initial interest rate of 5.316% APR, repayment will consist of 36 monthly payments of $1,073.64. If the interest rate were to increase by the maximum five percentage points to 10.316% APR, then the monthly payment would increase from $1,073.64 to a maximum of $1,704.93 in the third year. Other rates and terms are available. The terms used in this example are for illustrative purposes only and the actual terms you receive may be different depending on your individual circumstances.

5/1 Year ARM

Advantages:

  • Interest rate stays fixed for first 5 years, adjusting annually thereafter
  • Very low initial payments
  • Allows for higher loan amount qualification and enhanced buying power
  • Conversion to a fixed rate is available

Best Choice If:

  • You want a loan with lower initial payments
  • You want a loan with the benefits of both a Fixed and ARM product

ARM Features

  • Treasury Indexed ARM Interest and payment adjustment occurs every 12 months after initial fixed rate period
  • Rate caps = 2% at first adjustment, 2% per annual adjustment there after and 5% over the lifetime of the loan
  • Index = 1 yr. t-bill
  • Margin = 2.75%

For example, on a 5/1 1-Year Constant Maturity Treasury Index (1-Year CMT) Adjustable Rate Mortgage (ARM), the interest rate and payment are fixed for the first five years of the loan. The interest rate and payment may adjust every twelve months thereafter and may not increase or decrease more than 2.0% at each twelve-month adjustment. The interest rate cannot increase more than 5% over the term of the loan. For a 5/1 1-Year CMT ARM for $200,000 with a 30-year term and an initial interest rate of 5.698% APR, repayment will consist of 60 monthly payments of $1,119.95. If the interest rate were to increase by the maximum five percentage points to 10.698% APR, then the monthly payment would increase from $1,119.95 to a maximum of $1,726.62 in the fifth year. Other rates and terms are available. The terms used in this example are for illustrative purposes only and the actual terms you receive may be different depending on your individual circumstances.

7/1 Year ARM

Advantages:

  • Interest rate stays fixed for first 7 years, adjusting annually thereafter
  • Very low initial payments
  • Allows for higher loan amount qualification and enhanced buying power
  • Conversion to a fixed rate is available

Best Choice If:

  • Want to keep your payments lower during the first few years of your loan
  • Want the benefits of both a Fixed and ARM product

ARM Features

  • Treasury Indexed ARM Interest and payment adjustment occurs every 12 months after initial fixed rate period
  • Rate caps = 5% at first adjustment, 2% per annual adjustment there after and 5% over the lifetime of the loan
  • Index = 1 yr. t-bill
  • Margin = 2.75%

For example, on a 7/1 1-Year Constant Maturity Treasury Index (1-Year CMT) Adjustable Rate Mortgage (ARM), the interest rate and payment are fixed for the first seven years of the loan. The interest rate and payment may adjust every twelve months thereafter and may not increase or decrease more than 2.0% at each twelve-month adjustment. The interest rate cannot increase more than 6% over the term of the loan. For a 7/1 1-Year CMT ARM for $200,000 with a 30-year term and an initial interest rate of 6.081% APR, repayment will consist of 84 monthly payments of $1,167.15. If the interest rate were to increase by the maximum six percentage points to 12.081% APR, then the monthly payment would increase from $1,167.15 to a maximum of $1,783.04 in the seventh year. Other rates and terms are available. The terms used in this example are for illustrative purposes only and the actual terms you receive may be different depending on your individual circumstances.

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Mortgage loans are originated by Space Coast credit Union, and are subject to credit approval, verification and collateral evaluation. Programs, rates, terms and conditions are subject to change without notice. Certain restrictions apply.

*If your SCCU quoted rate is lower at 12:00pm five days prior to closing and the interest rate lock-in has not expired, SCCU will reduce your rate to the lower rate automatically. Rate guarantee is void if there is a change in property, loan program, loan term, or adjustments to interest rate based on credit score. Other conditions apply, contact SCCU for details.