ARM Mortgage Calculator
Calculate an adjustable-rate mortgage payment before and after the rate adjusts. See your initial payment, the new payment once the fixed period ends, and the increase. Free and accurate.
Calculator by Toolsloft ↗- Initial payment
- $1,610.46
- Adjusted payment
- $1,947.08
- Payment increase
- $336.61
See what an adjustable-rate mortgage costs before and after the rate adjusts, including the jump in your monthly payment. It is built for buyers considering an ARM who want to know what happens to the payment once the fixed teaser period ends.
How this is calculated
The loan is amortized at the initial rate over the full term, the remaining balance is carried forward through the fixed period, then re-amortized over the remaining months at the adjusted rate to find the new payment.
How to use
- Enter the loan amount and the initial (teaser) interest rate.
- Enter the fixed period in years, the rate it adjusts to, and the total loan term in years.
- Read the initial payment, the adjusted payment, and how much the payment increases.
Examples
- $300k, 5/7 ARM, 30 yr:
initial $1,610.46 → adjusted $1,947.08 - Payment increase:
+$336.61 per month after year 5
FAQ
- What is an adjustable-rate mortgage (ARM)?
- An ARM has a fixed initial rate for a set period (e.g. 5 years), then the rate adjusts. A 5/1 ARM is fixed for 5 years, then can adjust annually.
- How is the adjusted payment calculated?
- The loan is amortized at the initial rate through the fixed period to find the remaining balance, then re-amortized over the remaining months at the adjusted rate.
- Why does the payment go up so much?
- When the rate adjusts higher, the remaining balance is spread over fewer months at a higher rate, so the new monthly payment is larger than the initial one.