What this calculator does
ARM (adjustable-rate) mortgage works out payment during the fixed period, and the worst-case payment once the rate can adjust. Enter your own figures above and the answer updates as you type: nothing is fixed in the code, so the result reflects exactly the numbers you supply.
The formula this calculator evaluates is printed under the tool and explained below, so you can check the working by hand or reuse it in a spreadsheet.
The formula
FormulaFixed-period payment: standard amortisation at the initial rate. At the first reset the rate becomes the fully-indexed rate (index + margin), limited by the periodic cap and the lifetime cap over the initial rate; the payment is then re-amortised on the remaining balance over the remaining term.
The inputs explained
| Field | What to enter |
|---|---|
| Loan amount ($) | A number, measured in your currency. Starts at 400000. |
| Loan term (years) | A number, measured in years. Starts at 30. |
| Initial fixed rate (%) | A number, measured in %. Starts at 5.5. |
| Fixed-rate period (years) | A number, measured in years. Starts at 5. |
| Current index rate (%) | A number, measured in %. Starts at 4.5. |
| Lender margin (%) | A number, measured in %. Starts at 2.5. |
| Periodic adjustment cap (%) | A number, measured in %. Starts at 2. |
| Lifetime cap (over initial rate) (%) | A number, measured in %. Starts at 5. |
Worked examples
Every figure in the tables below is produced by this page’s own calculator at build time, so the numbers and the tool always agree. Select any row to load that scenario.
How the answer changes with loan amount
Every other input is held at the calculator’s starting values while loan amount varies. Select any row to load that scenario into the calculator.
How the answer changes with loan amount
| Loan amount ($) | Payment during the fixed period | Balance at first adjustment | Rate at first adjustment (capped) |
|---|---|---|---|
| 200,000 | $1,135.58 | $184,921.21 | 7.00% |
| 300,000 | $1,703.37 | $277,381.81 | 7.00% |
| 400,000 | $2,271.16 | $369,842.41 | 7.00% |
| 600,000 | $3,406.73 | $554,763.62 | 7.00% |
| 800,000 | $4,542.31 | $739,684.83 | 7.00% |
| 1,200,000 | $6,813.47 | $1,109,527.24 | 7.00% |