Question 1

What happens when my ARM adjusts in Cerritos?

Accepted Answer

Your rate moves with the index plus your margin, subject to caps. First adjustment typically capped at 2-5% increase depending on your loan terms.

Question 2

Can I refinance my ARM before it adjusts?

Accepted Answer

Yes, most borrowers refinance during the fixed period. You need sufficient equity and qualifying income for the new loan.

Question 3

Are ARMs riskier than fixed-rate mortgages?

Accepted Answer

ARMs carry rate risk after the fixed period. They're not riskier if you have a solid exit strategy before adjustment.

Question 4

Do Cerritos ARMs require larger down payments?

Accepted Answer

Conventional ARMs allow 5% down. Jumbo ARM programs typically require 20% down with higher credit scores.

Question 5

How do I know if an ARM fits my situation?

Accepted Answer

ARMs work when your ownership timeline matches the fixed period. Don't choose an ARM purely for lower payments you couldn't otherwise afford.

ARMs in Cerritos: Lower Initial Rates for Smart Borrowers