7/6 ARM: A Longer Initial Rate Period for Business Owners
A little more time before the first adjustment
Business owners often make plans around more than the next few months. They may be expanding a location, building a client base, or balancing personal housing needs with business investment. For borrowers who prefer a longer initial rate period than a 5/6 Arm provides, AAA Lendings' Self Prepared P&L/WVOE program includes a 7/6 ARM option for eligible scenarios.
Rate snapshot — October 26, 2026: Self Prepared P&L/WVOE rates start at 6.250% for the 5/6 ARM and 6.500% for the 7/6 ARM, before applicable adjustments. The 5/6 ARM is listed in CA, NV and TX; the 7/6 ARM in CA, CO, GA, IL, TX, VA and WA. Actual pricing depends on the borrower and loan scenario; APR may vary. Rates and fees are subject to change.
How the 7/6 ARM works
The 7/6 ARM begins with an initial seven-year rate period. After that period, the interest rate can adjust every six months under the loan's index, margin, and cap provisions. The current program materials identify the 30-day average SOFR index, a 3.000% margin, and a 5/1/6 cap structure. Borrowers should review the note terms and understand how an adjustment could affect future payments before selecting an ARM.
Designed to work with flexible income documentation
The program can be useful to discuss when an eligible self-employed borrower wants to use a self-prepared P&L rather than obtain a CPA-prepared P&L. That does not remove the need to document the business. Applicable requirements include business history, licensing, current financial information, asset and reserve review, credit, and property eligibility. A CPA letter or other supporting items may be required under the program guidelines.
Think beyond the initial period
A longer initial rate period may offer more time before the first potential adjustment, but it is not a promise of a lower rate or payment over the full loan term. Future interest rates and the borrower's circumstances are uncertain. Consider how the payment could change after year seven, whether your budget could accommodate that change, and whether your expected plans rely on selling or refinancing. A future refinance is never guaranteed.
Review the full picture
The 7/6 ARM should be compared with the 5/6 ARM and other available mortgage structures using the same borrower and property assumptions. State availability, loan limits, LTV, credit, occupancy, and other terms can vary. AAA Lendings can review the current matrix and pricing for your scenario before you decide.
Explore whether the 7/6 ARM aligns with your homeownership timeline and self-employed documentation needs.
Program availability, qualification, rates and terms vary by state, borrower profile, property type, loan purpose, and current guidelines. Rates and fees are subject to change without notice. Contact AAA Lendings for current program details.