Adjustable-Rate Mortgage Calculator
An adjustable-rate mortgage (ARM) has a fixed rate for the first years, then moves with the market. This calculator shows the payment before and after the first adjustment, and the worst case at the loan's rate cap.
Enter your figures below. Results update as you type.
Initial payment$2,334.29for the first 5 years
- Balance when the rate adjusts
- $371,048.75
- Payment at 7.5%
- $2,742.02
- Change in payment
- +$407.73
- Payment at the 10.75% cap
- $3,569.83
- Interest paid during the fixed period
- $111,106.23
This shows a single adjustment. Real ARMs adjust repeatedly and limit how far the rate can move each time.
How the Adjustable-Rate Mortgage calculation works
New payment = remaining balance repaid over the remaining term at the new rate
A $400,000 ARM at 5.75% has a payment of $2,334.29 for the first 5 years. If the rate then adjusts to 7.5%, the payment on the remaining $371,049 rises to $2,742.02. At a 10.75% lifetime cap it would be $3,569.83.
Frequently asked questions
What does 5/1 ARM mean?
The rate is fixed for the first 5 years, then adjusts once a year. A 5/6 ARM adjusts every six months after the fixed period. The first number is always the fixed years.
How much can an ARM payment increase?
Each loan has caps on the first adjustment, later adjustments and the lifetime rate. A common structure allows 2 points at the first change, 2 at each later change and 5 over the life of the loan.
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