Question 1

How much lower is an ARM rate vs. a fixed rate in Rialto?

Accepted Answer

The spread shifts with market conditions. ARM start rates typically run 0.5–1% below comparable fixed rates. Rates vary by borrower profile and market conditions.

Question 2

What does a 5/1 ARM mean?

Accepted Answer

The rate is fixed for 5 years, then adjusts once per year. Your cap structure limits how much it can move each adjustment and over the loan's life.

Question 3

What are ARM caps and why do they matter?

Accepted Answer

Caps limit how far your rate can rise. A 2/2/5 cap means 2% at first adjustment, 2% per year after, and 5% max over the life of the loan.

Question 4

Can I refinance out of an ARM before it adjusts?

Accepted Answer

Yes. Many borrowers refinance before the fixed period ends. Your ability to refinance depends on rates, equity, and your financial profile at that time.

Question 5

Does an ARM make sense if I plan to stay in Rialto long-term?

Accepted Answer

Probably not. If you're staying 10+ years, a fixed rate removes payment risk. ARMs reward borrowers with a defined, shorter time horizon.

Question 6

What index do ARM rates adjust to?

Accepted Answer

Most conforming ARMs adjust based on SOFR — the Secured Overnight Financing Rate. Your margin plus the index equals your new rate at each adjustment.

ARM Loans in Rialto: Lower Start Rates, Smart Strategy