Is there a cap on how often rates can move with an ARM?

It depends on the mortgage you received. Rates can be based on a number of indexes and fixed/changed periods. If you look in your loan documents, you should have an Adjustable Rate Rider showing you all the dates and possible change amounts.

Typically, for most conforming ARM's, there is a period where the rate is fixed.. after that it can adjust up or down a specified amount and it will change annually. For example, when you see a rate advertised as a 5/1 ARM, it means that the rate is fixed for 5 years, and then it adjusts once per year ever year after that until it matures. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

I agree with Mr. Acers response to your question. Open Mortgage has residential ARM and Fixed mortgage programs currently available with the local office in Riverside, MO. You can contact me directly at 816-268-5931.

If you are getting a conforming ARM 5/1 there is a index and a margin to determine future interest rates. The margin is added to the index to come up with your new rate. All 5/1 ARM should have caps on them. Normally it is a 5/2/5 meaning the first adjust can go up the full 5%, because there is a 5 yr fixed period. After that period of time the loan is treated like 1 yr ARM. It can go up or down by one more than 2% a year not to exceed 5% over the lifetime of the mortgage. If you need help just give me a call 314-703-7200.