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  1. Home
  2. Mortgages
  3. Adjustable-Rate Mortgages

Adjustable-Rate Mortgages

Adjustable-Rate Mortgages for Any Budget

Choose one of four adjustable-rate mortgage (ARM) options with an initial fixed-rate period. After the initial 1, 3, 5, or 7-year period, the rate can increase or decrease in any one year by just 1%.

Adjustable-Rate Mortgage Rates

Valid as of XX/XX/XXXX

Description Initial Rates As Low As APR* Margin Monthly Payment Example
30-Year 1/1 Adjustable 5.750% 7.824% 2.75% $5.84 /per $1000.00 for 1st year, 1 year ARM after
30-Year 3/1 Adjustable 5.875% 7.502% 2.75% $5.92 /per $1000.00 for 3 years, 1 year ARM after
30-Year 5/1 Adjustable 6.000% 7.272% 2.75% $6.00 /per $1000.00 for 5 years, 1 year ARM after
30-Year 7/1 Adjustable 6.125% 7.115% 2.75% $6.08 /per $1000.00 for 7 years, 1 year ARM after

Additional terms and rates are available. Please contact a mortgage consultant for more information at 800.237.7328 ext 3878.

*APR denotes Annual Percentage Rate. The APR reflects the total cost of the loan and takes into consideration not only the interest rate, but other charges or fees such as mortgage insurance, some closing costs, and points. The APR represents the annual cost of the loan stated as a percentage.

Rates, terms and information are variable and subject to change daily based on the 1 year Treasury Constant Maturity (Federal Reserve), and apply to loans up to Fannie Mae’s conforming mortgage loan limits. All ARMs offer a fixed rate for the initial period of the loan and may adjust annually thereafter. The interest rate and monthly payment may increase after closing. The maximum the rate can increase or decrease in any one year is 1%. The lifetime cap is 5% higher than the initial rate and the rate will not go below the margin. Rates and/or points are based on several factors, including but not limited to: property type, loan to value, loan purpose, occupancy, credit score, and subordinate financing. Mortgage loan payment example: 1/1 30 year variable of $5.84 per $1,000 borrowed at 5.75% for the first 12 payments; 12 payments of $6.49 per $1,000 borrowed if the rate adjusts to the annual maximum of 6.75%; 12 payments of $7.17 per $1,000 borrowed if the rate adjusts to the annual maximum of 7.75%; 12 payments of $7.88 per $1,000 borrowed if the rate adjusts to the annual maximum of 8.75%; 12 payments of $8.60 per $1,000 borrowed if the rate adjusts to the annual maximum of 9.75%; 299 payments of $9.35 per $1,000 borrowed if the rate adjusts to the ceiling at 10.75%. Payment amounts shown are representative of principal and interest only and do not include taxes and insurance, therefore, actual payment amount may be greater and varies from those shown. Loan amounts greater than 80% loan-to-value (LTV) ratio are subject to meeting private mortgage insurance requirements. Please contact us for specific rate information, mortgage loan limits, or down payment requirements at 800.237.7328, extension 3878.

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Need a Larger Home Loan?

Choose one of four jumbo adjustable-rate mortgage (ARM) options with loans from $726,201 up to $2.5 million.

Jumbo Adjustable-Rate Mortgage Rates

Valid as of XX/XX/XXXX

Description Initial Rates As Low As APR* Margin Monthly Payment Example
Jumbo 30-Year 1/1 Adjustable 5.750% 7.732% 2.75% $5.84 / per
$1000.00 for 1st year, 1 year ARM after
Jumbo 30-Year 3/1 Adjustable 5.875% 7.413% 2.75% $5.92 / per
$1000.00 for 3 years, 1 year ARM after
Jumbo 30-Year 5/1 Adjustable 6.000% 7.185% 2.75% $6.00 / per
$1000.00 for 5 years, 1 year ARM after
Jumbo 30-Year 7/1 Adjustable 6.125% 7.029% 2.75% $6.08 / per
$1000.00 for 7 years, 1 year ARM after

Additional terms and rates are available. Please contact a mortgage consultant for more information at 800.237.7328 ext 3878.

*APR denotes Annual Percentage Rate. The APR reflects the total cost of the loan and takes into consideration not only the interest rate, but other charges or fees such as mortgage insurance, some closing costs, and points. The APR represents the annual cost of the loan stated as a percentage.

Rates, terms and information are variable and subject to change daily based on the 1 year Treasury Constant Maturity (Federal Reserve), and apply to loans greater than Fannie Mae’s conforming mortgage loan limits up to 2.5 million dollars. All ARMs offer a fixed rate for the initial period of the loan and may adjust annually thereafter. The interest rate and monthly payment may increase after closing. The maximum the rate can increase or decrease in any one year is 1%. The lifetime cap is 5% higher than the initial rate and the rate will not go below the margin. Rates and/or points are based on several factors, including but not limited to: property type, loan to value, loan purpose, occupancy, credit score, and subordinate financing. Mortgage loan payment example: 1/1 30 year variable of $5.84 per $1,000 borrowed at 5.75% for the first 12 payments; 12 payments of $6.49 per $1,000 borrowed if the rate adjusts to the annual maximum of 6.75%; 12 payments of $7.17 per $1,000 borrowed if the rate adjusts to the annual maximum of 7.75%; 12 payments of $7.88 per $1,000 borrowed if the rate adjusts to the annual maximum of 8.75%; 12 payments of $8.60 per $1,000 borrowed if the rate adjusts to the annual maximum of 9.75%; 299 payments of $9.35 per $1,000 borrowed if the rate adjusts to the ceiling at 10.75%. Payment amounts shown are representative of principal and interest only and do not include taxes and insurance, therefore, actual payment amount may be greater and varies from those shown. Loan amounts greater than 80% loan-to-value (LTV) ratio are subject to meeting private mortgage insurance requirements. Please contact us for specific rate information, mortgage loan limits, or down payment requirements at 800.237.7328, extension 3878.

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Resume Application or Check Status
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How PSECU Adjustable-Rate Mortgages Work

PSECU currently offers 1-, 3-, 5-, and 7-year adjustable-rate mortgages (ARMs), which means the monthly payment and interest rate will be locked in for the initial period and may change annually thereafter.

For example:

  • A 1-year ARM has a fixed rate for the first 12 months and then may change annually.
  • After the initial period, and each year thereafter, the interest will either remain the same, increase, or decrease based on the current rate environment at that time.
  • The maximum the rate can increase in any one year is 1%, and over the full term of the mortgage, the rate can only increase by a maximum of 5% over the original interest rate.
  • You can refinance out of the ARM and into a fixed-rate mortgage at any time* during the term of the mortgage with no pre-payment penalty.
*It’s important to note that while refinancing at any time is an option, it is not guaranteed and will depend on your future situation, the property value of your home, and market conditions.

Browse Common Questions

Have questions or want to chat with someone about our adjustable-rate mortgages? Speak with one of our mortgage consultants today to discuss your options. Consultants are available Monday – Friday 8 a.m. – 5 p.m. and Saturday 9 a.m. - 12 p.m. at 800.237.7328, ext. 3878.

  • After you submit your mortgage application, a PSECU mortgage consultant will review your application. We’ll answer any questions you may have and, if you're qualified, provide you with a prequalification letter if you’re purchasing a home. The prequalification letter lets you know exactly how much house you can afford and helps you make a strong bid to the seller.

    Once you find the right house and go under contract, we can move forward in the loan process. At this time, you provide more detailed financial information. Throughout the process, our mortgage consultants will keep you up to date regarding the status of your loan to make sure everything is on track. After closing, we’ll service your loan through the life of your mortgage.

  • We will finance properties that are:

    • Located in the state of Pennsylvania
    • Recorded with PSECU listed as first lien holder. The property secures your mortgage loan.
    • Titled after purchase in the name(s) of individual(s), not a trust
    • Owner-occupied homes, vacation homes, or residential non-owner occupied properties with one, two, three, or four units. Some exceptions apply.
    • Condominiums or residences within a Planned Unit Development (PUD) that meet certain criteria. Please contact our mortgage consultants for more information.

    We will not finance properties that are:

    • Single-wide manufactured homes
    • Timeshares
    • Not in acceptable marketable condition
    • Non-owner-occupied condo or manufactured homes
    • Located outside Pennsylvania
  • You may request to waive an escrow account if the loan-to-value (LTV) is 80% or lower, taxes and insurance have been paid timely in the past, and you have the ability to pay them on your own.

  • An adjustable-rate mortgage (ARM) differs from a fixed-rate mortgage in many ways. Most importantly, with a fixed-rate mortgage, the interest rate stays the same during the life of the loan. With an ARM, the interest rate changes periodically, usually in relation to an index, and payments may go up or down accordingly.

    The initial rate and payment amount on an ARM will remain in effect for a limited period—ranging from just 1 month to 5 years or more. For some ARMs, the initial rate and payment can vary greatly from the rates and payments later in the loan term. Even if interest rates are stable, your rates and payments could change a lot. If lenders or brokers quote the initial rate and payment on a loan, ask them for the annual percentage rate (APR). If the APR is significantly higher than the initial rate, then it is likely that your rate and payments will be a lot higher when the loan adjusts, even if general interest rates remain the same.

    With most ARMs, the interest rate and monthly payment change quarterly, semi-annually, yearly, 3 years, 5 years, 7 years or 10 years. The period between rate changes is called the adjustment period. For example, a loan with an adjustment period of 1 year is called a 1-year ARM, and the interest rate and payment can change once in a 12-month period. A loan with a 3-year adjustment period is called a 3-year ARM. You will carry the initial interest rate for the first three years before the first-rate adjustment may take place.

  • Lenders generally charge lower initial interest rates for ARMs than for fixed-rate mortgages. At first, this makes the ARM easier on your pocketbook than a fixed-rate mortgage for the same loan amount. Moreover, your ARM could be less expensive over a long period than a fixed-rate mortgage. For example, if interest rates remain steady or move lower. An ARM is a great option if your goal is to get the lowest possible mortgage interest rate starting out.

    Against these advantages, you have to weigh the risk that an increase in interest rates would lead to higher monthly payments in the future. It’s a trade-off—you get a lower initial rate with an ARM in exchange for assuming more risk over the long run.

    Here are some questions you need to consider:

    • Is my income enough—or likely to rise enough—to cover higher mortgage payments if interest rates go up?
    • Will I be taking on other sizable debts, such as a loan for a car or school tuition, in the near future?
    • How long do I plan to own this home? (If you plan to sell soon, rising interest rates may not pose the problem they do if you plan to own the house for a long time.)
    • Do I plan to make any additional payments or pay the loan off early?
  • The reality is that for many homebuyers who want the lower payment of an adjustable-rate loan, the added risk is often more than they can afford to take because they don't have a big income or vast savings. So, for those borrowers who have tight budgets and little savings to assist with making higher payments if rate increases, they would be better off doing a mortgage product that offers less financial risk or purchasing a less expensive home.

 

The content provided in the section above is for informational purposes only. Nothing stated is to be construed as financial or legal advice. Some products not offered by PSECU. PSECU does not endorse any third parties, including, but not limited to, referenced individuals, companies, organizations, products, blogs, or websites. PSECU does not warrant any advice provided by third parties. PSECU does not guarantee the accuracy or completeness of the information provided by third parties. PSECU recommends that you seek the advice of a qualified financial, tax, legal, or other professional if you have questions.

Realize the Benefits of a PSECU Home Loan

At PSECU, you’ll find a wide variety of mortgage loan products, customized service, and experts to guide you through the mortgage application process.

  • We offer competitive rates and reduced closing costs, as we do not charge our members for appraisals, flood certifications, or credit reports.
  • We also work with preferred settlement companies throughout Pennsylvania that our members can choose to save even more money on their closing costs.
  • You can get pre-qualified or complete your application online, at your convenience – and if you have questions, our trained mortgage consultants are here to help.

 

Get Pre-Qualified or Apply
Resume Application or Check Status
Call a Mortgage Consultant
Back to Mortgages
Explore More:
  • First-Time Homebuyer
  • Fixed-Rate Mortgages
  • Refinancing
Home Equity
Put the value of your house to work for you. Choose from three great home equity products from PSECU.
  • First-Time Homebuyer
  • Fixed-Rate Mortgages
  • Refinancing

Have Questions? We're Here to Help

Need to talk to us directly? Call 800.237.7328 or send an inquiry.

Resource Center

Personal finance resources from PSECU are free financial literacy resources for adults. Explore our free financial education resources on money management. Knowledge is power!

What Is Digital-First Banking?

Digital banking means accessing banking products and services via a bank or credit union's website or mobile app. However, digital-first banking with PSECU means so much more.

Support Center

The PSECU customer support center is a helpful source of information for everything from the PSECU routing number to ordering checks, checkbook covers, and check registers.
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Achieve More with PSECU

More gimmes + less gotchas = modern digital banking. Become a member today, and let your money live in the 21st century.

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Contact one of our mortgage consultants to find out which mortgage product is right for you.
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800.237.7328
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