Question 1

How much lower is the initial rate on a portfolio ARM?

Accepted Answer

Typically 0.5-1.0% below fixed portfolio rates, though exact pricing depends on your profile and the lender. Rates vary by borrower profile and market conditions.

Question 2

Can I refinance before the rate adjusts?

Accepted Answer

Yes, most borrowers refinance during the fixed period. No prepayment penalties exist on most portfolio ARMs, making early refinancing straightforward.

Question 3

What happens at the first rate adjustment?

Accepted Answer

Your rate adjusts based on an index plus a margin, subject to caps. Most first adjustments cap at 2% above your start rate.

Question 4

Do portfolio ARMs work for investment properties in Sierra Madre?

Accepted Answer

Absolutely. Many portfolio lenders focus specifically on investor scenarios that don't fit agency loan limits or conventional qualification rules.

Question 5

How does self-employment income get verified?

Accepted Answer

Most portfolio lenders accept 12-24 months of bank statements instead of tax returns. They average deposits to calculate qualifying income.

Portfolio ARMs in Sierra Madre: Flexible Financing for Complex Borrower Profiles