Platinum Funding offers 5/1 ARM for 3.375%

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Platinum Funding has one of the best deals around on a 5/1 adjustable-rate mortgage.

As of May 21, it was offering an introductory interest rate of 3.375% with $995 in fees and no points.

Principal and interest payments for the first five years of that loan would be just $442 a month for every $100,000 you borrowed.

Some lenders are offering ARMs with lower rates. But watch out.

The rates on some bargain-basement loans can go up as much as five percentage points when they reset for the first time.

The Platinum Funding ARM won't do that. Its interest rate caps are "2/2/6," which means it can't go up more than two percentage points the first time it adjusts in five years, or two percentage points each year after, and it can never go up more than six percentage points.

Of course, this kind of loan makes the most sense if you plan to sell the home before the mortgage resets.

But plans like that don't always work out, and you need an ARM you can still afford even if the payments go up and you can't sell or refinance right away.

Interest rates are at historic lows, and you have to assume they'll be higher a few years from now.

Platinum Funding is based in Lake Forest, Calif., and licensed to write mortgages in all 50 states.

To qualify for this loan, you need a credit score of 700 or higher. You must also be applying for a conforming loan -- one for less than $417,000 to $729,500, depending on where you live.

Click here to check the best mortgage rates from scores of other lenders in your area.

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