Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions.
Key Principles
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers.
Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information.
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.
We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.
Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service.
Today’s 5/1 ARM Rates
The table below brings together a comprehensive national survey of mortgage lenders to help you know what are the most competitive 30-year mortgage rates. This interest rate table is updated daily to give you the most current rates when choosing a 30-year mortgage loan.
Rates as of Tuesday, April 13, 2021 at 6:30 AM
What is a 5/1 ARM loan?
As the name suggests, the interest rate on an adjustable-rate mortgage, or ARM, changes over time. For a five-year ARM, the introductory rate stays the same for five years. Then the rate can change once a year, typically rising as much as 2 percentage points at a time.
How does a 5/1 ARM work?
The amortization schedule is the same as for a 30-year mortgage. The variable interest rate after the fifth year is determined by an index. Until recently, the London Interbank Offered Rate, or LIBOR, was the benchmark of choice. As of September 2020, the Secured Overnight Financing Rate, or SOFR, had replaced LIBOR.
When should you consider a 5/1 ARM?
ARMs are a good option when rates are high. ARMs first became available to American homeowners in 1981, a year when the average rate on a 30-year loan surged past 18 percent. As mortgage rates rode a rollercoaster through the 1980s, homeowners often flocked to ARMs. Rates spiked in 1984 and again in 1987, and ARMs made up more than two-thirds of all mortgages during those periods of rising rates. With fixed rates at record lows as of September 2020, ARMs probably aren’t the wisest choice. That’s reflected by the small number of borrowers taking ARMs — they account for less than 3 percent of mortgage applications.
The only way an ARM would make sense is if the rate and other fees combined equal a lower APR than a fixed mortgage for the term, and that’s not happening at this time in the marketplace.
Share