Question 1

What does the 7/1 in a 7/1 ARM mean?

Accepted Answer

Your rate stays fixed for 7 years, then adjusts annually. Most Beverly Hills buyers sell or refi before that first adjustment hits.

Question 2

Can I get a jumbo ARM in Beverly Hills?

Accepted Answer

Yes. Jumbo ARMs are common here given loan sizes. You'll typically need 720+ credit and 20% down to qualify.

Question 3

What index do ARM loans use today?

Accepted Answer

Most new ARMs use SOFR — the Secured Overnight Financing Rate. It replaced LIBOR and is now the standard benchmark.

Question 4

How much can my rate increase after the fixed period?

Accepted Answer

That depends on your cap structure. A 2/2/5 cap limits increases to 2% at first adjustment and 5% over the life of the loan.

Question 5

Is an ARM risky on a $3M Beverly Hills purchase?

Accepted Answer

Risk depends on your exit timeline and cash reserves. With strong reserves and a planned refinance window, ARMs are a calculated trade-off, not a gamble.

ARM Loans in Beverly Hills: Lower Rates, Smarter Plays