Adjustable-Rate Mortgage Loan (ARM)

Adjustable-Rate Mortgage Loan (ARM)


An adjustable-rate mortgage (ARM) is a home loan in which the interest rate is based on an index that reflects current market conditions plus a margin that is added to the index. This index value varies and is available upon request or at application time. Typically, the interest rate is fixed for a period of time and then changes annually.

ARMs can be good for borrowers who plan to sell or refinance their home after the initial term ends. In the end, choosing an adjustable-rate mortgage loan could save you money. 

Adjustable-Rate Mortgage Highlights:

  • Lower initial rates compared to a fixed-rate loan
  • Rate/payment is locked in for the first 7 years
  • Capped annual and lifetime adjustments after the initial term
  • Can be good for those only planning to stay in their home a few years

ARM Loan Plans:

  • 7/1 ARM - The interest rate on a 7/1 ARM will remain fixed at the initial rate for the first 7 years. After that, the interest rate will change annually based on the value of the index plus the margin, subject to annual and lifetime interest rate adjustment caps.

Jumbo Adjustable-Rate Loans are also available for adjustable-rate mortgage loans more than $700,000.

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Convenient Automatic Payment Option

With Capitol Federal's Automatic Payment Option, we handle all the details of paying your mortgage after you enroll…and this service is provided to you at no cost. Authorize deduction from a checking or savings account and determine the transfer date: 1st, 5th, 10th, 15th, 20th or 25th of each month.*

To start your Automatic Payment Option, simply complete the Automatic Payment Option Agreement Form** (PDF), sign and return the form, together with a check marked "void", to:

Capitol Federal
Attention: Loan Service Department
700 S Kansas Avenue
Topeka, KS 66603

If you prefer, you may fax the completed form to CapFed at 785-270-6024 or send via encrypted email to

Once registered, make a notation in your account register - or confirm the transaction through True Blue Online® banking. It's perfect! No checks to write, no postage to pay and no forgotten payments or checks lost in the mail. Under Capitol Federal's Automatic Payment Option, customers may make additional principal payments to their loan.

*Mortgage Loans and Consumer Loans are available on these dates; although for Consumer Loans, if the Automatic Payment Option payment date is later than the loan payment due date, additional finance charges may be incurred. Execuline transfer date available only on 10th of each month. All transfers are processed only on regular business days. Should the transfer date fall on a weekend or federal holiday, the transfer will be processed on the next business day. If the mortgage or loan payment amount changes, the customer will be notified in advance of the change.

**One agreement form is required for each loan.

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No Surprises with Fixed Rates

Learn more about how a conventional fixed-rate mortgage could offer you lower monthly payments, plus the security of knowing your interest rate will stay the same.

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