Adjustable-Rate Mortgage Calculator: ARM vs Fixed
Compare a fixed-rate loan with the intro payment of an ARM and every capped reset up to the note's maximum rate, with resets every 6 or 12 months.
What This Calculator Does
This adjustable-rate mortgage calculator puts a fixed-rate quote beside an ARM on the same loan amount and amortization. You see the ARM's intro payment, then a hypothetical path that climbs by every cap. You choose how often it resets. Each reset spreads the remaining balance over the months left, and the table follows every scheduled change through payoff. It doesn't forecast the index. It doesn't judge total cost either.
Who Is This For
It fits borrowers weighing ARM against fixed-rate U.S. note terms quoted in dollars, with resets every six months or annually.
How It Works
Complete all nine fields; no rate or cap is supplied by default. Choose the intro length, the term both loans share, and a reset every six or twelve months. Then review the full 13-metric summary and the full reset table. Look hardest at the first reset, the rate the ARM reaches and the earliest month the payment peaks.
Frequently Asked Questions
What does the calculator work out?
The results set the payments side by side: the ARM's P&I while the intro rate holds, the fixed loan's payment, and a worst-case path where every cap is used right up to the final payment. Both loans share the amount and term. During the intro period, the gap between payments carries a + or − sign. Fees, insurance and escrow stay out of the math, as do APR and any equity from an early payoff. Which loan is cheaper overall? The tool doesn't say.
What's the difference between intro years and reset frequency?
Intro years set how long your starting rate holds. Reset frequency sets how often it can move afterward, every 6 or 12 months. After 5 intro years, the first modeled reset falls on payment month 61. With the same 5-year intro, later resets come from month 67 on a six-month schedule or from month 73 on an annual one. In a hypothetical 400k/30-year loan at a 5.5% intro rate with 2/1/5 caps, the rate reaches 10.5% in month 79 with six-month resets and in month 97 with annual ones. The highest payments reach roughly $3,473.60 with six-month resets and $3,454.15 with annual ones. Those inputs are invented, not quotes.
Are caps measured in percent or in percentage points?
Percentage points. A cap sets how far the rate is allowed to climb, which has nothing to do with discount points or with percentage growth. For instance, starting at a 5.5% intro rate under a 5-point lifetime cap, the most the contract allows is 10.5%. In the summary, that ceiling is shown apart from the increase and from the peak rate the loan really hits before it's paid off. The form's input limits, including a ceiling of up to 50%, come from the form itself, not from law.
Why is the payment recalculated from what's still owed?
By the time a reset arrives, the payments you've already made have cut the principal and shortened the months remaining. At each rate change, the calculator pays off what's left over just those remaining months. It doesn't go back to the original loan amount or begin a new 30-year schedule, which is why the payment comes out exactly the same whenever the rate doesn't move.
What happens when the intro runs to the end of the loan, or a cap is set to zero?
When the intro runs the full term, nothing resets before payoff. You'll see N/A in the first-reset fields, and the intro payment is the peak starting in month 1. Setting the upward cap to zero gives a confirmed limit; the field isn't left empty. Resets still appear on the schedule, each with zero rise. The contract ceiling might never come into play when too few resets are left or the periodic cap blocks any increase.
Is the rate path a forecast of the index plus margin?
No. The path takes every allowed increase up to the ceiling, and only within the term that's left. Real indexed rates can come out differently. The full event table covers up to 54 resets, and the peak isn't limited to the first five. Other reset schedules, interest-only periods and payment caps need a different model built for them. So do negative amortization, downward caps and rate floors.
If the intro savings are positive, is the ARM the better deal?
Not on their own. The figure is the fixed P&I minus the ARM's intro P&I, added up over every intro payment, and negative results stay in. That makes it neither interest saved, nor an equity-adjusted benefit, nor a ruling on which loan costs less. Other charges can differ between the loans. Refinancing later isn't something to count on. As for the stress scenario, it isn't how a lender qualifies you, and it isn't an approval.
Where do I find the full path and the source's limits?
Check all resets, both on screen and in the PDF, rather than stopping at five. The AI receives the complete 13-metric summary along with all reset events. The CFPB CHARM booklet points out that the length of the intro period is separate from how often the rate changes; that source was last verified October 2, 2026, and it can't confirm your own rate, caps, fees or approval, so check those against your loan note.