The term of this loan is 30 years. This loan has a low start rate that stays in effect for the first year. The index for a One-Year Treasury Arm is the One-Year Treasury bill. The index is based on the interest rate that the government pays on some of it’s debt. At the end of the first year the rate will adjust to the fully indexed rate as long as it does not exceed the maximum periodic cap of 2%. There is a life cap on this loan, which is usually around 6% over the start rate.