10/1 ARM, 7/1 ARM, 5/1 ARM, 3/1 ARM, 1/1 ARM

• Fixed rate for a certain period (10, 7, 5, 3, or 1 year), and then the interest rate changes annually to the current market rate which will now be the interest rate for that given year.
• Most ARMs will have the following:
  
• Interest rate cap: protects you from enormous increases in monthly payments.
  
• Lifetime cap: limits the interest rate increase over the loan period.
  
• Periodic or Adjustment cap: limits how much the interest rate can increase at one time.