Why ARMs Are Back in the Spotlight—and How You Can Benefit
If you’ve been watching the mortgage market lately, you’ve probably noticed something interesting: Adjustable-Rate Mortgages (ARMs) are making a comeback. In fact, the Mortgage Bankers Association reports ARM applications are at their highest level since 2023. So, what’s driving this trend—and how can you leverage it for your customers and your bank?
Why Borrowers Are Choosing ARMs
- Lower Initial Rates: ARMs typically start with a much lower interest rate than a traditional 30-year fixed mortgage. That means smaller monthly payments during the initial fixed period—always a win for borrowers.
- Perfect for Short-Term Plans: If your customer plans to sell or refinance before the adjustable period kicks in, they can enjoy those lower payments without worrying about future rate changes.
- More Buying Power: Lower payments often mean borrowers qualify for a bigger loan, helping them afford the home they really want.
What’s in It for You?
At Bankers’ Bank, we’ve enhanced our ARM program to make it even more attractive. Here’s the kicker: you can earn up to 2 points on each loan. That means your borrowers get competitive rates, and you see a solid return. Everybody wins.
Real-World Example: ARM vs. Fixed
| Loan Type | Initial Interest Rate | Monthly Payment (Years 1-5) | Monthly Savings (Years 1-5) | Total Savings (5 Years) | Price | Payment to your bank |
| 5/6 ARM | 5.50% | $1,703 | $193 | $11,580 | 102.00 | $4,707 |
| 30- Yr Fixed | 6.50% | $1,896 | 0 | $0 | 101.913 | $5.739 |
Based on a $300,000 loan at 80% LTV and a 770 credit score. ARM payments may adjust after year 5, but you’d save about $11,580 in the first five years compared to a fixed-rate loan. If rates drop, your payment could go even lower.
Bottom Line
ARMs offer flexibility, lower initial payments, and real savings—especially for buyers who expect to move or refinance in a few years. By educating your customers and actively offering ARMs, you position your bank as a trusted advisor in a changing market. That’s how you help families get into homes they love—and build lasting relationships along the way.
✅ Your Next Step
Start the conversation today. Reach out to your borrowers who might benefit from an ARM and show them the numbers. Then, connect with your Bankers’ Bank mortgage representative to lock in these competitive rates and maximize your earnings. Don’t wait—ARMs are trending, and now is the time to lead the way.