Summary Secured Overnight Financing Rate (SOFR) Index ARM products will be available for new applications and registrations on or after September 1, 2020. The final day for applications or registrations for LIBOR Index ARM products will be August 31, 2020. All LIBOR Index ARM loans must close or fund by November 30, 2020 and may not be switched into the new SOFR Index ARM products.
New SOFR Index ARMs
The new SOFR Index ARM products will remain 5-, 7- or 10-year fixed to adjustable-rate products, with a subsequent 6-month rate change in place of the current yearly rate change, after the fixed-rate period.
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Index |
The 30-day average of the Secured Overnight Financing Rate (SOFR) as published by the Federal Reserve Bank of New York |
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Margin |
3.00% |
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Life Floor |
The floor is the margin |
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Interest Rate Caps |
Product |
First |
Subsequent |
Lifetime |
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5/6 |
2% |
1% |
5% |
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7/6 |
5% |
1% |
5% |
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10/6 |
5% |
1% |
5% |
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Change Date |
5/6 |
The first Change Date is the 61st payment due date. Subsequent Change Dates are every 6 months thereafter. |
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7/6 |
The first Change Date is the 85th payment due date. Subsequent Change Dates are every 6 months thereafter. |
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10/6 |
The first Change Date is the 121st payment due date. Subsequent Change Dates are every 6 months thereafter. |
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Qualifying Rate |
5/6 |
Greater of the Fully Indexed Rate or the Note Rate + 2% |
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7/6 & 10/6 |
Greater of the Fully Indexed Rate or the Note Rate |
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ARM Plans |
5/6 |
4927 |
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7/6 |
4928 |
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10/6 |
4929 |
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Conversion Option |
Not available |
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