Use our 7/1 ARM calculator to plan for adjustable-rate mortgage payments after seven years of fixed rates. Extra payments or interest-only options are easy to factor in, showing their impact on your loan balance and total interest. Enter your loan details to explore different scenarios and see how your payments could adjust over time.

7/1 ARM Calculator

7/1 ARM Loan Payments with Extra & Interest-Only

Basic Loan Information

Loan Amount ($)

Initial Interest Rate (%)

Loan Term (Years)

ARM Adjustment Details

Note: The boxes below are for illustration purposes. You may adjust the values to match your specific loan terms.

Adjustment Frequency after initial fixed period

Note: The calculation boxes below are for illustration purposes. You can edit any field to explore different scenarios, and the totals will automatically update.

Margin + Index = Interest Rate

Margin (%)

Index (%)

Interest Rate (%)

Current Interest Rate + Annual Cap = Interest Rate

Current Interest Rate (%)

Annual Cap (%)

Interest Rate (%)

Lifetime Interest Rate Cap (%)

Annual Rate Cap (%)

Optional Settings

Interest-only payments during initial fixed period

Extra Principal Payment ($/month)

Payment Summary

Initial Monthly Payment

Your fixed payment for the first 7 years

First Adjustment Payment

Year 8 payment (rate + 1%)

Maximum Payment

At lifetime cap (initial rate + 5%)

Total Interest (Worst-Case)

Based on +1% annual increases to cap

Amortization Schedule (Worst-Case Scenario)

Shows rates increasing by 1% annually after year 7, up to the lifetime cap

Year	Rate	Monthly Payment	Principal	Interest	Balance

How to Determine the Index Rate

Although determining your adjustment rate may seem difficult, it's actually quite simple. The most confusing factor is frequently the index rate. It is evident from the boxes above how your new interest rate is determined step-by-step.

Here is the the best source for the index used by Fannie Mae:

1. Federal Reserve Bank of New York (Official Source)
> The Secured Overnight Financing Rate (SOFR) https://www.newyorkfed.org/markets/reference-rates/sofr-averages-and-index
The index rate can be found under the 30-DAY AVERAGE (%). Look for the date on the left. This is the index rate that Fannie Mae uses. As of this writing, the index rate was 4.20185 .

2. Federal Reserve Bank of St. Louis (FRED)
> 1-Year Treasury Constant Maturity Rate: https://fred.stlouisfed.org/series/DGS1
In the top-left corner, under “Observations,” you’ll see the current index rate. This index is used by some lenders.

As of this writing, the index rate was 3.59%. Enter 3.59 in the index box above. Your lender will provide the margin, which is the additional percentage they charge. This margin remains fixed for the life of the loan. Add the index rate and margin together to find your current interest rate.

Understanding the Fannie Mae ARM Index Rate

But what happens if the index rate spikes? That’s where rate caps protect you. For this ARM, the interest rate can increase by no more than 2% per year (every 12 months) until it reaches the lifetime cap of 5%. After entering your numbers, review the worst-case amortization schedule to see how payments could adjust over time.

Ask the lender when the new interest rate is calculated. For example: The lender calculates the new rate at the end of the initial term (e.g., after 7 years for a 7/1 ARM), and the new rate will apply for the next adjustment period.

This calculator is designed to help you clearly understand how an adjustable-rate mortgage works - and to give you the confidence to manage it wisely.