Adjustable-Rate Mortgage

With an Adjustable-Rate Mortgage (ARM), your interest rate changes periodically, based on market conditions and the current rate environment. 

For many borrowers, that’s a big advantage because the initial interest rate will almost always be lower than with a fixed-rate mortgage.

But that’s not the only benefit. With an ARM from ESL, you may be able to:

• Qualify for a larger loan amount because your initial payments will be lower
• Save money with a lower initial rate
• Take advantage of a lower rate if interest rates decline
• Protect yourself from big changes in monthly payments when interest rates are volatile, thanks to the automatic “rate caps” built into the mortgage

ARMs are also a great option if you’re planning to own your home for a short period or you’re thinking of refinancing down the road.

Learn More About Our Great ARM Options

• We have three Adjustable-Rate Mortgage options to choose from.  The five-year, seven-year, and 10-year ARM products feature fixed-rate terms of five, seven, and 10 years respectively. Payment adjustments for all products occur every six months after the fixed rate period.
• Combine an ESL ARM with a Home Equity Solution to eliminate Private Mortgage Insurance, get “cash out” from your equity, or qualify for a 10% down payment + closing costs. Find out more about Mortgage + Home Equity Financing.

Call 585.336.1502 or 800.352.6669, x1502, to speak with a helpful member of our Mortgage Team today.

Our adjustable rate mortgage is based on the SOFR (Secured Overnight Financing Rate) index, with an initial fixed rate term of five, seven, or 10 years. Rates and payments are adjusted every six months thereafter. The payment is based on a 30-year term. Available for both jumbo and conventional mortgage amounts.

Eligible Properties 

Owner-occupied 1-4 unit residence, condominiums, modular homes, and planned unit developments (PUDs), or second homes.

Ineligible Properties 

Manufactured homes; cooperative housing (co-ops); property used for agriculture, farming or commercial enterprise; vacant land; investment property, and multi-family (5+ units).

Lending Area 

Property must be located in Genesee, Livingston, Monroe, Ontario, Orleans, Seneca, Steuben, Wayne, Wyoming, and Yates Counties in the state of New York.

Mortgage Insurance 

Mortgage insurance is required if the loan to value (LTV) is over 80%.

Payment Due Date 

Payment due date will be determined when the loan is disbursed.

Payment Options

• Automatic transfer (AutoSweep) from savings or checking
• Automatic debit from a checking or savings account at any financial institution
• ESL branch or telephone banking
• ESL online or mobile banking
• Connect with an ESL representative so we can help

No prepayment penalties

When you get a mortgage from ESL, you can pay it off at any time without worrying about any prepayment penalties.

Interest Rate – APR (Annual Percentage Rate)

Rates subject to credit evaluation. Actual rates may vary. Rates may increase during your loan term. All rates quoted are for properties located in upstate New York.

Index 

Six-month SOFR is the 30-day average of the Secured Overnight Financing Rate (SOFR) as published by the Federal Reserve Bank of New York.

Margin 

A fixed percentage that is added to the SOFR rate at each adjustment period. The margin we use is as low as 3.00%.

Rate Caps 

• 5/6-month ARM – Following the five year fixed-rate period, the rate can increase or decrease up to 2% during the first adjustment period and 1% per year after that, with a lifetime cap of 5% above the initial rate.
• 7/6-month ARM – Following the seven year fixed-rate period, the rate can increase or decrease up to 5% during the first adjustment period and 1% per year after that, with a lifetime cap of 5% above the initial rate.
• 10/6-month ARM – Following the ten year fixed-rate period, the rate can increase or decrease up to 5% during the first adjustment period and 1% per year after that, with a lifetime cap of 5% above the initial rate.

Rate Change 

The new rate will be the index in effect 45 days prior to the change date plus the margin rounded to the nearest one eighth of one percentage point (0.125), except as limited by the caps (see above). The new payment amount will be sufficient to fully amortize the remaining balance at the new interest rate for the remaining term.

Rate Lock Details 

The interest rate may float from time of application to 21 business days prior to closing. Anytime during this float time period, the interest rate may be locked. Conventional mortgage rates are quoted based on a 45-65 day rate lock.

For rate information, call 585.336.1502 or 800.352.6669, x1502, to speak with a helpful member of our Mortgage Team today. Or fill out this contact us form to have a member of our Mortgage Team reach out to you.

Understanding ESL Mortgage Closing Costs and Fees 

Here’s something important to remember when you’re shopping for a mortgage: 

We carefully manage and control the mortgage process from start to finish. Our goal? We want to minimize the costs our members pay. That’s one of the reasons why our closing costs are among the lowest in our area.

We also make sure that our entire approach to closing costs is straightforward and easy to understand. That’s why you’ll know exactly what’s due prior to closing. And you won’t have any unexpected, last-minute expenses that may delay the closing process.

A Quick Reference Guide to Closing Costs

At ESL, we realize that buying a home can be a complex and confusing process for many home buyers. That’s why we want to make sure you understand all of the specific costs involved in your closing

Here’s a quick recap of these common closing costs:

• Origination charges cover our fees for processing your mortgage application, including your application and underwriting fees, the costs involved in document preparation, and the settlement and attorney costs. 
• Discount points are paid voluntarily in exchange for a lower interest rate. They are calculated as a percentage of your loan amount and usually paid at closing.
• Mortgage Insurance will be required on loans with over 80% LTV to protect the lender in the event of default of the borrower.
• Other expenses for third-party services obtained on your behalf. These expenses include the costs for your title insurance and fees for appraisals and credit reports.
• Taxes and other government fees cover your state and county mortgage taxes and the recording fees paid to the county clerk.
• Prepaid items include property taxes, homeowners insurance, and prepaid interest. They may also include mortgage insurance.

Estimate Your Closing Costs

To make a sound financial decision about a mortgage, it helps to estimate your closing costs in advance. 

That’s why we provide a helpful Mortgage Closing Calculator. It will help you find a mortgage that fits your financial situation and your budget.

Use our Mortgage Closing Calculator today.

Post-Closing: Potential for Late Fees

At ESL, there’s only one fee that may be assessed after your closing. And that only happens if your mortgage payments are late. If we do not receive the full monthly payment 15 calendar days after the scheduled due date, you’ll have to pay a late fee that is 2.0% of the total overdue payment of interest and principal.

Please remember, however, that there are easy ways to avoid late fees. Just make sure your mortgage payments are made on time every month. View Loan Payment Options. 

It’s easy to apply.

• Call 585.336.1502 or 800.352.6669, x1502, to speak with a helpful member of our Mortgage Team today. Or fill out this contact us form to have a member of our Mortgage Team reach out to you.

Please remember that borrowers and co-borrowers must be at least 18 years old to apply.

In preparation for your mortgage application please begin to gather, and be prepared to eventually make available, the following documents:

• Income for all borrowers – your W2s and tax return will provide this information.
• Banking information – banking statement information that include bank name, your name, account number, current balance, and 30 days transaction history.
• Estimate monthly expenses – Write down your monthly expenses like rent, mortgage, utilities, credit cards, and additional expenses.
• Estimate funds available for down payment (excludes closing costs).
• Estimate for closing cost, property taxes, and insurance.
• Purchase contract – if available at application.
• Inspection expenses – receipt/invoice for any/all inspections, if available at application.