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Adjustable Rate Mortgages (ARMs) in Lincoln
Lincoln buyers use ARMs to capture lower initial rates when they plan to move or refinance within 5-7 years. Rate savings in year one typically run 0.5-1% below fixed rates.
Growth in Lincoln's newer neighborhoods means many borrowers aren't staying in starter homes long enough to see rate adjustments. An ARM matches that timeline.
ARMs require the same credit and income standards as fixed loans. Lenders qualify you at the fully-indexed rate, not just the teaser rate.
You'll need 620+ credit for conventional ARMs, 580+ for FHA ARMs. Down payment minimums match fixed-rate equivalents—3% conventional, 3.5% FHA.
Not all lenders price ARMs aggressively. We see rate spreads of 0.25-0.375% between wholesale lenders on identical 5/1 and 7/1 products.
Jumbo ARM pricing varies wildly—some portfolio lenders beat agency products by 0.5%, others charge premiums. Shopping across 200+ lenders matters here.
Most Lincoln buyers pick 5/1 or 7/1 ARMs. The 3/1 saves another 0.125% but that's too short for most ownership timelines.
Read the caps closely. A 5/2/5 structure means 5% first adjustment, 2% annual adjustments after, 5% lifetime cap. That math changes your worst-case scenario dramatically.
ARMs beat fixed rates when you're certain about your exit timeline. If there's any chance you stay past the fixed period, a 30-year fixed costs less stress.
Conventional ARMs undercut Jumbo ARMs on conforming loan amounts in Lincoln. Once you cross $806,500, portfolio ARMs from specialized lenders often win on rate.
Lincoln's newer subdivisions see buyers upgrading within 5-7 years as families grow. That pattern fits ARM timelines perfectly.
If you're buying in established Lincoln neighborhoods near Twelve Bridges, verify your ARM savings justify the rate risk. Turnover runs slower in mature areas.
Your rate adjusts based on an index plus a margin. Most ARMs use SOFR plus 2-3%. Annual and lifetime caps limit how much rates can jump.
Yes, most borrowers refinance or sell before the first adjustment. You need sufficient equity and qualifying income for the new loan.
Absolutely. Jumbo ARMs often price 0.75-1% below jumbo fixed rates. Placer County buyers use them for larger purchases with planned exits.
Conventional ARMs require 620+ credit. FHA ARMs accept 580+. Jumbo ARMs typically need 700+ for best pricing.
ARMs carry rate risk after the fixed period. If you're certain you'll move or refinance within 5-7 years, that risk is manageable.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.