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Adjustable Rate Mortgage (ARM)

What is an Adjustable Rate Mortgage?

Adjustable rate mortgages, also called ARMs, are a type of home financing where the interest rate and payment are fixed for an initial period of time and then adjust periodically over time as interest rates fluctuate. The interest rate adjustments are tied to an index plus a margin set by the bank.


ARM options we offer

  • 5/1 ARM
    Has a fixed rate for the first 5 years and then the rate adjusts once a year every year after.

  • 7/1 ARM
    Has a fixed rate for the first 7 years and then the rate adjusts once a year every year after.

  • 10/1 ARM
    Has a fixed rate for the first 10 years and then the rate adjusts once a year every year after.

How does an Adjustable Rate Mortgage Work?

Let's say you purchase a home with a 5/1 ARM loan. The loan has a fixed rate for five years, and then the rate adjusts 1 time each year thereafter, which could be higher or lower than the initial rate, depending on market rates when it comes time for the adjustment. With an interest rate adjustment comes a monthly payment adjustment. ARMs do have caps limiting the amount rates and payments can change.


When is it good to get an ARM?

ARMs tend to have lower monthly payments during the initial term than fixed rate loans, which make them attractive if you want to qualify for a larger loan. ARMs might be a fit if you know you won’t be staying in your home long-term or if your career demands frequent moves. The fact that the monthly payments may fluctuate over time makes some borrowers shy away from ARMs if sticking to a particular budget is important to them.

It’s important for borrowers to weigh out all the risks and rewards that come with each mortgage option. Talk to an experienced Mortgage Loan Officer to help sort out the best answer to your particular home financing needs.




Get started online

Apply or get pre-qualified for an any of our Adjustable Rate Mortgage options by clicking the buttons below.

Apply now for a mortgage

Get prequalified for an adjustable rate mortgage

Have questions?

Call us at (877) 820-2265 to schedule an appointment with a Mortgage Loan Officer or fill out the contact form below and we will have one of our Loan Officers reach out to answer any questions you have.



Disclosures and borrower information
Macatawa Bank's primary lending area is West Michigan. Online applications will be considered received on today’s business day if submitted during the course of the bank’s normal business hours;
9am EST – 5pm EST Monday – Friday, excluding Federal Holidays
9am EST – 12pm EST on Saturdays
Applications received outside of this timeframe, including Federal Holidays and Sundays will be considered received the next business day.

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