Buy big with a jumbo ARM that starts at 2.75%

Model house on top of money

Aurora Financial is offering some of August's best deals on 5-year adjustable-rate jumbo mortgages in 15 states across the country.

It has a couple of options, based on how much cash you have for a down payment or equity for a refinancing.

If you can put at least 40% down, or have 40% equity in your home, it's charging an introductory rate of just 2.75% with no points and no fees on a 5/1 jumbo ARM.

Your principal and interest payments for the first five years of that loan would be just $408 per month for every $100,000 borrowed under the introductory rate.

You can use our adjustable-rate mortgage calculator to determine the monthly payment for the exact amount you want to borrow with this loan.

It will also provide a month-by-month amortization schedule that shows how much you've reduced your debt and how much you still owe if you want to pay off the loan.

In order to qualify for this option, you'll need:

If you can't swing the 40% down payment, which is understandable, Aurora is offering 2.875% for 20% down, or 20% equity in your home if you're refinancing.

That's also with no points and no fees, and you'd only need a credit score of 740 or higher.

The monthly payments on this option would be a little higher, but not by much. You'd pay around $415 per month in principal and interest for every $100,000 borrowed under the introductory rate.

Both options have a rate lock period of 30 days.

Aurora Financial is headquartered in Vienna, Virginia, and enjoys an A+ grade from the Better Business Bureau.

It's offering these jumbo loans in: California, Connecticut, Florida, Georgia, Illinois, Massachusetts, Maryland, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina, Virginia, Washington and West Virginia.

Don't live there? Search our database of the best mortgage rates from scores of lenders in your area.

Come close to these terms, and you'll know you've found a good deal. But be sure and check the interest rate caps to make a full and fair comparison.

Rates on some of these loans can jump up by as much as five percentage points when they reset the first time.

But neither one of these options from Aurora will do that. The interest rate caps for both deals are 2/2/5.

That means that your interest rate can't go up more than:

Although mortgage rates have defied all predications and declined so far this year, it's a pretty safe bet that rates will move higher, perhaps substantially higher, when this loan first adjusts in five years.

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That means your rate for the lowest-cost option could go no higher than 4.75% at the first adjustment, 6.75% at the second adjustment and max out at 7.75%, depending on where rates are at that time.

But either way, in case you can't sell or refinance, it's important to make sure you can still afford the monthly payments if you're stuck with this loan for more than five years.

At 7.75%, your monthly principal and interest payments for this loan would jump up to $716 per month for every $100,000 borrowed.

And don't forget to factor insurance, property taxes and association fees into the payment, which can really bump up your monthly check to the bank.

Keep in mind, you don’t want to drain your savings and take on mortgage payments that you are struggling to make every month. Here's how to find the price range that's right for you.

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