More information of Bank of America Adjustable-Rate Mortgage (ARM)
Bank of America offers a wide variety of mortgage loans. On this occasion we are going to analyze the adjustable-rate mortgage, in which the interest rate can fluctuate over time depending on the price of the reference index, in this case the SOFR (Secured Overnight Financing Rate).
In addition, this variable mortgage includes a first period with a fixed-rate interest that can be 5, 7 or 10 years long, depending on your choice.
Depending on the option chosen, the amount, your creditworthiness and where you live in the United States, your fixed interest rate may vary, but it will be a minimum of 5.25% if it is 5 years, 5.63% if it is 7 and 6.5% if they are 10 years of fixed interest.
During the adjustable period, the interest rate will be calculated by adding a spread of 2.75% to the value of the SOFR regardless of the fixed period you choose. The review of the interest rate applied to your loan will be carried out every 12 months, recalculating the percentage applied according to the last value of the reference index.
The value of the rate you want to finance can be between $60,000 and 2.5 million dollars and the term to repay the money is 30 years.
You may be also interested on the Bank of America Fixed-Rate Mortgage Loan to compare and to know the conditions when the monthly payments don't change.
English: Hipoteca variable de Bank of America