Adjustable Rate Mortgage ARM

Adjustable Rate Mortgage ARM

Adjustable Rate Mortgages in general have a lower interest rate than fixed rate loans. The lower rate means lower mortgage expense, but the lower rate does have its possible drawbacks.

The interest rate can change at the adjustment period. Subsequently, so will your monthly mortgage expense, but I wish I had a nickel for every fuzzy report that claimed there would be widespread loan defaults because of Adjustable Rate Mortgages. That obviously has not come to pass, but there is a comfort zone in fixing your monthly mortgage expenses with a fixed rate loan, even if those expenses are higher that they might be with an ARM mortgage.