5 2 5 Arm

A 5 year ARM, also known as a 5/1 ARM, is a hybrid mortgage. A hybrid mortgage combines features from an adjustable rate mortgage (ARM) and a fixed mortgage. It begins with a fixed rate for a specified number of years, but then changes to an ARM with the rate changing every year for the rest of the term of the loan.

Sales are forecast to fall 5.4 per cent to $2.94 billion. JPMorgan expects costs of doing business to rise to 33.7 per cent, from 33.4 per cent last year, as negative operating leverage offsets cost.

On a 5-1 hybrid ARM, this might be expressed as a 5-2-5 cap structure, meaning there is a 5% initial cap, 2% periodic cap and 5% life cap. This means that at the first interest rate change date,