If you have an ARM, you probably selected it because it offered a lower initial interest rate.  This lower initial rate:

• Increased your borrowing power
• Provided you with lower monthly payments than you would get from a fixed-rate mortgage

However, the low initial rate doesn't stay that way forever; it's scheduled to change periodically.  When and how often it changes depends on the type of ARM you selected:

• The initial interest rate can remain fixed for the first one to 10 years.  After that, it's adjusted periodically based on financial market conditions and the type of loan you have.
• During the initial fixed-rate period, your monthly payments are lower than those of a fixed-rate loan.
• After the fixed-rate period expires, your loan will adjust every six months of every year, depending again on the ARM product you have.

Check your loan documents for details about how the adjustments are determined, the percentage that's added to determine your new rate, and the maximum amount the rate can increase over the life of the loan.

If you should need assistance, feel free to contact me by phone 301-843-5646 or by email:  John.Woodburn@wellsfargo.com .