# ARM Reset Prep: 5 Moves Before Rate Adjustment

> Homeowners with adjustable-rate mortgages should prepare for potential payment spikes before their next rate reset.
- Title: ARM Reset Prep: 5 Moves Before Rate Adjustment · Kiplinger
- Summary: Homeowners with adjustable-rate mortgages should prepare for potential payment spikes before their next rate reset.
- Keywords: adjustable-rate-mortgage, mortgage-reset, interest-rate-adjustment, refinancing, fixed-rate-mortgage, mortgage-payment, sofr, mortgage-servicer, ARM, Reset, Prep, Moves
- Source: Kiplinger — https://kiplinger.com/real-estate/mortgages/your-adjustable-rate-mortgage-is-about-to-reset-moves-to-make-now
- Published: 2026-10-29T14:45:52+00:00
- Read time: 1 min
- Topics: adjustable-rate-mortgage, mortgage-reset, interest-rate-adjustment, refinancing, fixed-rate-mortgage, mortgage-payment, sofr, mortgage-servicer
## ARM reset timing
Homeowners with adjustable-rate mortgages may face payment spikes when introductory rates expire.
## ARM reset date
Most ARMs have fixed-rate periods lasting five to seven years before rate adjustments begin.
## Rate adjustment factors
New rates depend on a benchmark index like SOFR and a lender-set margin added together.
## Rate caps
Most ARMs have caps limiting how much interest rates can increase at each adjustment.
## Refinancing costs
Refinancing into a fixed-rate mortgage may cost 2-5% of the loan amount in closing fees.
## Payment comparison
Keeping an ARM with 3% rate costs $307 less monthly than refinancing into a 7.32% fixed-rate mortgage.
## Extra payments
Paying down principal before rate adjustment may reduce future payment amounts.
## Loan modification
Contacting your mortgage servicer may offer loan modifications to manage payment increases.
## Budget preparation
Preparing for $400 monthly payment increases requires $2,400 emergency savings for six months.
## Rate reset impact
ARM resets can increase monthly payments by hundreds of dollars or more.
## Mortgage recast
Mortgage recasts allow lump-sum principal payments to recalculate monthly payments.
## Emergency savings
Putting thousands toward mortgage may reduce emergency funds for unexpected expenses.
## Key takeaway

Homeowners with adjustable-rate mortgages should prepare for potential payment spikes before their next rate reset.