Adjustable-Rate Mortgage (ARM)
If you plan to stay in your home for just a few years or believe rates will fall enough to refinance, an ARM can be right for you.
What is a Adjustable Rate Mortgage (ARM)?
An adjustable-rate mortgage is a home loan that starts with a lower fixed interest rate for the first 5, 7, or even 10 years. After that, the rate adjusts periodically based on the market rates at that time. Today’s ARMs come with many safeguards for borrowers like rate caps, so you save money up front without taking on runaway risk.
This program is ideal if you plan to move, sell, or refinance within the next decade. By starting with a lower rate, you can unlock extra buying power, reduce monthly payments, and keep more cash free for other goals—without being locked into a higher 30-year fixed rate.
Best of all, ARMs often pair perfectly with our Rate Rebound program. When rates drop, you can refinance with LendFriend into a fixed mortgage at minimal cost, giving you long-term security without overpaying in the short term.
ARM Example: A buyer in Houston chose a 5/1 ARM to purchase a $750,000 home. Because the ARM rate was 0.5% lower than a 30-year fixed, saving him over $3,000 a year in interest. He plans to refinance when rates fall, but in the meantime, he keeps thousands in savings every year.
Why Homebuyers Choose LendFriend For ARMs
At LendFriend Mortgage, we guide buyers through ARMs with clear terms and no hidden fees—helping you use this flexible product to your advantage.
Here’s why borrowers from California to Texas to Florida trust us:
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Lower initial payments. Save hundreds per month compared to a 30-year fixed.
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Built-in safeguards. Rate caps protect you from sudden spikes.
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Flexibility for movers. Perfect if you plan to sell or refinance in 5–10 years.
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Smarter refinancing options. Pair your ARM with our Rate Rebound program to lock in lower rates later at minimal cost.
Lower Your Monthly Payments with a Smart ARM Loan
Adjustable rate mortgages from LendFriend provide substantially lower monthly payments during the initial fixed period compared to traditional 30-year mortgages. This difference means thousands saved in the first few years, allowing you to build equity faster or enjoy greater financial flexibility. Austin homebuyers use these savings to upgrade home features, build emergency funds, or invest in property improvements.
Flexible 5/1, 7/1, and 10/1 Options Based on Your Plans
LendFriend offers multiple ARM structures to match your specific timeline and financial goals. Our 5/1 ARMs work perfectly for those planning moves within five years, while 7/1 options provide extended stability for growing families. The 10/1 ARM delivers a full decade of fixed rates with lower payments than traditional 30-year mortgages.Fast 3-Week Closings
Unlike other Austin mortgage lenders, LendFriend has little to no origination or processing fees on ARM loans—saving you thousands in closing costs. Our streamlined process closes your mortgage in as little as two weeks, essential in Austin's competitive real estate market. This efficiency helps secure properties in sought-after neighborhoods like Mueller, South Congress, and The Domain.
See Why Homebuyers and Homeowners Consider Us The Best Mortgage Broker
5/5 Star Reviews on Google, Zillow, and Experience.
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We worked with the LendFriend team and could not recommend it more. As first time home buyers, there is a lot to learn - and LendFriend know how to share their knowledge with patience and professionalism.For anyone considering working with them, just go ahead and give them a call. You will not regret it.
Jesper Holdensen
Closed June 2025 -
I had been looking for a house for 2-3 years and while it was a journey as a business owner with a difficult financial situation this company did what 6 others could not. They got me a jumbo loan based off my business income and when I needed more they just made it happen twice. This process of funding can be extremely difficult and basically a blow to the ego but Eric and his team are literally magicians and my fiancee and I are now closed on out dream house. I recommend them whole heartedly
Shawn Tassone, MD, PhD
Closed April 2025 -
Wow my husband and I were truly impressed with how easy the LendFriend team made our home buying experience. Eric and his team took extra care in explaining and outlining each step -- a real customer first experience. On top of that, each member of the team was incredibly knowledgeable, organized, and responsive; resulting in an expeditious close! The website promise of working around the clock to support you is 100% factual, we had staff answering questions late night and weekends. The entire team was a real pleasure to work with, so if you are looking for a mortgage broker look no further, LendFriend is the team for you! They will give you peace of mind, get you the best rates, and make you feel confident when buying your home :)
Sarah Carr
Closed May 2025 -
I have purchased 8 houses in 23 years and have never had an easier closing. Eric and his team have streamlined the process and were a pleasure to work with. They also saved us a lot of money on closing. I highly recommend LendFriend and his team.
April Magnia
Closed August 2025 -
Eric and LendFriend saved the day! We had a lender who struggled so terribly that the sellers were willing to put their property back on the market. Our realtor pulled the deal from the ashes and we chose LendFriend to make it right quickly. We closed a million plus VA loan in 3 weeks and now have our forever home. Thank you LendFriend, Eric, and Morgan!
Brian Sanford
Closed July 2025 -
Highly recommend LendFriend!!! As daunting as the process can be to get pre-approved for a mortgage loan, the entire team was great that we worked with that got us to the finish line. Each team member helped us in clearly communicating each step to ensure every step was smooth, in addition being available for a quick call to walk through our questions and concerns when needed. LendFriend was also very competitive with rates and dropped our interest rate last minute right before we closed! They got the job done and made it as stress free as possible.
Ingrid Eichenberger
Closed December 2024 -
I had a phenomenal experience working with Eric, Morgan, and Crystal at LendFriend and cannot recommend them enough. They helped me secure an asset depletion mortgage (30 year fixed rate), allowing me to qualify using my Bitcoin and Ethereum holdings. This enabled me to purchase an amazing home for my family while keeping and maintaining control of my hard assets... I worked with Eric, Morgan, and Crystal throughout the process. Communication was excellent, everything was explained clearly, and the overall experience was smooth... [Read the whole review by clicking the link below]
J
August 2025
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FAQs – Adjustable Rate Mortgages Explained
What happens if interest rates rise during my loan term?
Your rate stays fixed during the initial period—5, 7, or 10 years depending on your ARM—so there are no increases until that term ends. Afterward, rate caps limit how much your payment can rise at each adjustment and throughout the life of your loan. LendFriend explains these caps before closing, so you’ll always know your maximum payment. Many clients refinance or sell their home before the initial period ends if rates move higher.
Can I switch to a fixed-rate mortgage later on?
Yes, anytime. Most clients choose ARMs for lower initial payments, then refinance before adjustment. Our "Customer for Life" program makes this transition simple.
Are there penalties for paying off the loan early?
Never. Make extra payments, refinance, or sell whenever it benefits you. This flexibility serves homeowners well in a dynamic market.
How much down payment do I need for an ARM?
Down payments vary by loan type. For conventional ARMs, buyers can qualify with as little as 5% down. Jumbo and Non-QM ARMs typically require 10–20% down. Learn more about minimum down payment requirements.
How are ARM interest rates set?
ARMs start with a lower fixed rate (about .25%-.5% lower in this market) for the first 5–10 years, then adjust based on a market index plus a set margin. Because of this structure, ARM rates are usually lower than 30-year fixed rates, giving you immediate monthly savings. Read more in our guide: ARMs Make a Comeback.
What credit score do I need for an ARM?
Most ARMs require a minimum score of 620, though stronger credit scores (i.e., 760+) qualify for the best pricing. A higher score can mean lower rates and fees, saving you thousands over the life of the loan. Learn more about how your credit score impacts mortgage rates.