Jumbo or non-conforming mortgages have a higher loan amount than conventional, FHA and VA guidelines allow. These loans make up for the deficiencies created by specific county loan limits. Jumbo or non-conforming mortgages are limited in their overall loan to value ratio and loan amount.
Guidelines and Parameters
An ARM has two components—the first number represents how long the interest rate will remain fixed, or will not change for that period of time of the loan. The second number tells you the length of time and frequency the loan will adjust once the variable portion kicks in. ARMs use predetermined caps and margins that work in concert with monetary fund indexes to establish the interest rate when the loan adjusts.
- 10/1 ARM: Your interest rate is set for 10 years then adjusts for 20 years.
- 7/1 ARM: Your interest rate is set for 7 years then adjusts for 23 years.
- 5/1 ARM: Your interest rate is set for 5 years then adjusts for 25 years.
- 3/1 ARM: Your interest rate is set for 3 years then adjusts for 27 years.