Fixed-Rate vs Adjustable Mortgages: What’s Right for You?

Choosing between a fixed-rate and adjustable-rate mortgage (ARM) comes down to your financial goals, how long you plan to stay in the home, and your comfort with risk.

A fixed-rate mortgage offers consistent monthly payments over the life of the loan. That predictability is helpful if you’re budgeting long-term or planning to stay in the property for a while. Rates may start slightly higher than ARMs, but there’s no surprise rate increase later on.

Adjustable-rate mortgages typically start with a lower interest rate for a set period (e.g., 5 years), after which the rate can change annually. These can be appealing if you plan to move or refinance before the rate resets. But they carry risk—if rates rise, so do your payments.

It’s also important to understand how caps work with ARMs—limits on how much the interest rate or payment can increase. Without this knowledge, you may end up with unaffordable monthly costs.

Work with a loan advisor who explains your real options. Don’t just look at rates—look at your timeline, your income stability, and your future plans. The right mortgage isn’t about the lowest rate. It’s about the best fit for your life.