How do I calculate the 2026 'Trigger Rate' for you?
The Trigger Rate is the point where the monthly interest equals the monthly payment.
Primary sources
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Related Questions
What is the technical difference between a VRM and an ARM?
A VRM (Variable Rate Mortgage) has a variable payment that can change, but the interest rate varies with prime rate movements and payments may remain fixed until a trigger rate is reached, after which negative amortization can occur.
Why is the variable-to-fixed conversion rule so critical?
Most lenders allow borrowers to convert to a fixed rate mid-term for free, provided the new term is equal to or longer than the remaining variable term.
How do 2024 reforms impact insured variable products?
Insured variables on homes up to $1.5M now allow for 30-year amortizations (for FTHB/New Builds).
When does the 'Open Rate Premium' become worth it for you?
Open rates cost ~2% more (roughly $10,000/year on $500K) — only worth it if you expect to sell, refinance, or pay off within 12 months.