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FlexChoice Convertible Mortgage

The flexible choice to buy a home today, and convert to a fixed-rate later

A FlexChoice Convertible Mortgage from Members Choice Credit Union offers lower starting rates so you can afford to buy a home sooner, and get more home for your budget. You can relax knowing you have an option after 3 years to convert to a fixed-rate mortgage at no cost to you.
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Low initial adjustable rate 

With a low initial adjustable rate, you can purchase today at a lower rate than a conventional fixed-rate mortgage, getting more home for your budget.

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Convert to fixed-rate without refinancing or paying fees

After three years, you can lock in a low fixed rate at the offered market price at that time, at no cost to you

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Local loan servicing and advice

We’ll never sell your loan and will service it locally through your entire term.

Open up your home buying power

Get flexibility with your mortgage to take advantage of potentially lower rates in the future, without the need to refinance

FlexChoice Convertible Mortgage**

Our FlexChoice Convertible Mortgage is designed to provide flexibility and security to our members. You can take advantage of a lower initial adjustable rate today, with the option to convert to a fixed-rate mortgage at any time after three years, without refinancing. FlexChoice can give you peace of mind if you wish to to buy a home today, but believe that rates will fall in a few years.

Benefits of the FlexChoice Convertible Mortgage

  • Low Interest Rate - With a low initial adjustable rate, you can purchase today at a lower rate than a conventional fixed-rate mortgage.
  • Interest Rate Adjustment Cap - Your annual interest rate adjustments will begin after 5/7/10 years and include a 1% APR* rate cap
  • Lock in Your Rate - After 3 years, the conversion option allows you to lock in a low fixed rate at the offered market price at that time.
  • Convert with No Fees or Refinancing Closing Costs – Converting from an adjustable-rate mortgage to a fixed-rate mortgage after three years is at no cost to you. You will not have the hassle or cost of refinancing. 

Compare Mortgage Home Loan Options

FlexChoice Convertible Mortgage**
Traditional ARM*
Conventional Fixed-Rate*
Min FICO Score 720 620 620
Option to modify After three years, you can convert your FlexChoice adjustable-rate mortgage into a fixed-rate mortgage and lock in any future mortgage rate decreases
Loan Amounts $100,000 to $726,200 $50,000 to $726,200
Loan Terms 5, 7 or 10-year initial ARM terms available; 30-year maximum term 15/20/30-year fixed terms available
Rate Cap Low 1.00% annual rate increase maximum after the initial loan term.


Get started with an estimated rate quote – No credit pull required

Fill out the short form below to get a call back from a Mortgage Loan Officer within the next business day.

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Call us at 281.754.1103 to start a new loan by phone

FAQs about Adjustable-Rate Mortgage (ARM) Loans

You may be hesitant to buy a home now with fixed rate mortgage rates on the rise. Fortunately, a convertible mortgage offers a lower starting rate, which is fixed for five, seven, or ten years. This means you pay less monthly interest than a conventional fixed-rate mortgage right now.

Not only will you save money but you can build home equity faster since you are paying more towards your loan principal and less on interest.

  • Convertible mortgage loans offer lower initial interest rates compared to fixed-rate mortgages, making them a more affordable option for some borrowers.
  • Borrowers can take advantage of potential interest rate decreases in the future if the market conditions change and the interest rate drops.
  • Convertible home loans typically come with lower monthly payments in the first few years of the loan term, which can help borrowers manage their cash flow and budgeting.
  • Convertible home loans provide flexibility, as they can be converted to a fixed-rate mortgage at any time during the loan term, allowing borrowers to lock in a stable interest rate if they want to.

Yes, if you have a higher credit score (720+) and a lower debt-to-income (DTI) ratio, you have the option to select our FlexChoice Convertible Mortgage, allowing you to convert your adjustable-rate mortgage to a fixed-rate loan after three years, with no modification fee. This is a great benefit if market rates drop in your favor at that time.

Your fixed-rate APR* will be based on current market rates at the time you convert your loan.

This is a mortgage that is fixed at a lower than market rate (called the Start Rate) for a certain number of years, then adjusts each year after that for the term of the loan

  • The Adjustment Rate is tied to the One Year Treasury Constant Maturity Index plus a set margin. 
  • There is a cap on how low the rate can go, called a Floor Rate.
  • There is a cap on how high the rate can go, called the Ceiling Rate.
  • There is a rate adjustment cap of 1%.
  • We offer fixed periods of 5, 7, and 10 years.

Example of a Rate Adjustment:

  • Current Mortgage Rate: 3.375%
  • Today’s One Year CMT Rate is 3.02%
  • The Margin is 2.25%
  • The new Adjusted Rate would be: 3.02 + 2.25 = 5.37

However, there is a rate adjustment cap of 1%, therefore the adjusted rate would be 4.375%.

Our promise is to provide a high level of service and work in your best interests:

  • We have personalized customer service that aims to meet your personal needs
  • Our member service team offers a local person to talk to and provide faster service
  • You're a member, not just a number
  • We try to make the home buying experience a great one – easy and stress-free
  • We’ll never sell your loan and will retain servicing for the life of the loan

Yes, applying for a mortgage loan before you find a home may be the best thing you could do.  When you apply in advance, you are issued a pre-approval letter subject to finding your new home. 

You can use the pre-approval letter to assure your real estate agent that you are a qualified buyer and look in the right price range to fit your budget. Having been pre-approved for a mortgage may also give more weight to any offer you make.

There is no fee to complete an online application for any of our loan products. If you are applying for a Mortgage (Purchase or Refinance), a non-refundable fee of $55.00 is collected when the Loan Officer pulls your credit report to begin the pre-approval/loan process.

There is no obligation to complete the mortgage or equity process once an application is completed.

There is no fee to modify your rate to a fixed rate after three years if you have selected the FlexChoice Convertible Mortgage option at the initiation of your mortgage.

The Loan Officer will interview you and analyze your completed application, your credit report, and an automated underwriting system to determine which documents we’ll need to process your application. During the processing and underwriting part of your loan, other documentation may be required for final approval.

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APR = Annual Percentage Rate.

*Purchase for primary, second, and investment properties in Texas only. Minimum 620 credit score required. $100,000 minimum loan amount for ARM loans, $50,000 minimum loan amount for conventional fixed-rate loans. $726,200 maximum loan amount.

**Purchase for primary, second, and investment properties in Texas only. Minimum 720 credit score required for FlexChoice option. Modification rates are based on the current market at the time of conversion. Must be in ARM product for a minimum of 3 years prior to modification. After 3 years you have the option to modify your loan after three years to a fixed-rate loan based on the current market rate at that time. No modification fee is charged.

If not currently a Members Choice member, a $5 deposit is needed to establish membership. All memberships and lending products are subject to approval including credit approval.

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