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LIBOR Index Change

We’re here to help

Understand and prepare for changes to your adjustable-rate mortgage.

LIBOR index change

We're here to help you understand and prepare for changes that will affect your adjustable-rate mortgage.

The LIBOR index, used to determine the interest rate charged for some adjustable-rate loans, may no longer be available after 2021. This will affect some loans and lines of credit that use the LIBOR index to determine interest rate. We’re working with regulators and consumer advocacy organizations to move existing accounts from LIBOR to another index in a way that’s fair and transparent.

Here's what this means for you:

  • If your adjustable rate mortgage is based on the LIBOR index, a new index will be assigned to your loan at your first rate adjustment after December 2021.
  • Starting in August 2020, new adjustable-rate mortgages will no longer use the LIBOR index.

LIBOR Index FAQs

Before reviewing the LIBOR frequently asked questions, it may be helpful to learn more about adjustable-rate mortgages on our ARM site, or by reviewing information from the CFPB (PDF).

Why is the LIBOR index going away?

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LIBOR is based on transactions that don’t occur as often as they did in prior years. The regulators that oversee LIBOR stated they can’t guarantee LIBOR will be available beyond the end of 2021. Banks, financial institutions and governments across the globe have been working to identify options for replacing LIBOR.

 

Future of LIBOR UK article

Does the change to LIBOR only impact Chase loans?

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No. All loans and financial products that are based on LIBOR are affected.

What is Chase doing about changes to LIBOR?

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We’re working closely with other lenders, servicers, our regulators, our investors and consumer advocacy groups through the Alternative Reference Rates Committee (ARRC) to develop a transition plan to a replacement index that is fair and transparent.

What is the ARRC?

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ARRC is a group of private market participants created by the Federal Reserve to help ensure a successful transition from LIBOR. You can learn more about ARRC from their website: https://www.newyorkfed.org/arrc.

What index will replace LIBOR?

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It is expected that the SOFR (Secured Overnight Financing Rate) index will replace LIBOR for most ARM loans. SOFR is the replacement rate recommended by the Alternative Reference Rates Committee (ARRC). You can view SOFR index rates here. We will keep you informed of all changes to your loan, including the replacement rate.

 

For more information on the discontinuation of LIBOR, see the ARRC website: https://www.newyorkfed.org/arrc.

When will my adjustable-rate mortgage change to the new index?

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The SOFR based index will be used to determine the interest rate when your loan has its regular interest rate adjustment after December 2021. Until then, your interest rate will continue to be based on the LIBOR index.

What happens if I get a new adjustable-rate mortgage?

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Starting in August 2020, new adjustable-rate mortgage loans through Chase will be based on the SOFR index. Loans originated before August 2020 may be based on the LIBOR index and then transition to SOFR in 2022.

How will you keep me informed about changes to my loan?

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We want to ensure you have the information you need during this transition. We’ll post updates to chase.com as new information becomes available, deliver information by mail in early 2021 and send updates by email approximately 90 days before LIBOR ends. We’ll also send updates by mail and email when your loan is updated to the SOFR index, as well as when your new interest rate and payment effective dates get closer. Make sure your contact information is current on chase.com to ensure you receive these updates.

Will the change to the SOFR index increase my payment?

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The change to the SOFR index alone won’t necessarily increase your monthly payment.

With any ARM loan, the interest rate (and therefore the payment) can increase whenever you have a scheduled interest rate adjustment, regardless of the index that's used.

Learn more about how ARM payments are calculated.

What if I can’t afford my payment?

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If you’re concerned about your ability to make your payment and are interested in a new mortgage loan, explore your options here.  If you’re experiencing financial difficulty, view our mortgage assistance options.

Can the mortgage index be changed without my permission?

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The original loan documents (specifically the note), allow for the index of an adjustable rate mortgage to change if the index is no longer available.

Should I get a new mortgage loan?

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You don't have to get a new mortgage because of this change, however it may be a good time to determine if your mortgage still meets your financial needs.  If your financial goals have changed, you’re looking for a stable payment amount or you can benefit from a lower interest rate, you may consider getting a new mortgage.

Review your options

Does this change affect fixed rate mortgage loans?

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No. Mortgages with a fixed rate will not be impacted directly by the LIBOR transition.

Are new ARM loans based on LIBOR?

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Chase no longer offers adjustable rate mortgages based on the LIBOR index. Any new Chase adjustable rate mortgage loans will be based on the SOFR index.

 

Learn more about your options or apply online.

Will anything else about my ARM change?

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All other details about your loan will remain the same.

Will my interest adjustment happen earlier than expected because of this change?

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No. The timing of your interest rate adjustment will not change, and your interest rate will continue to be based on the LIBOR index, for adjustable rate loans originated through December 2021.

 

Example 1: A 7/1 ARM was originated in 2020. The first interest rate adjustment will occur in 2027. The interest rate on this loan will remain the same and be based on the LIBOR index until 2027.

 

Example 2: An ARM loan has an interest rate adjustment every year in July. The interest rate on this loan will remain the same and be based on the LIBOR index until July 2022