Adjustable Rate Mortgage or ARMs are appealing because they usually offer a low initial interest rate and payment.  Adjustable loans are also worth considering if you plan to be in your home a short time.  For the borrow, this means you can qualify for a larger mortgage loan.  Furthermore, at times when rates are falling the borrower can take advantage of the lower interest rates without the refinancing their mortgage.

With an Adjustable Rate Mortgage - ARM, your monthly mortgage payment may change frequently and significantly over the term of your loan.  You must decide if you can afford to take this route and if you can stomach it.  Some borrows find the concept of varying interest rates a bit scary, others are willing to take the risk.

TYPES OF ARMS

Another option is a fixed rate mortgage where the interest rate remains unchanged for the life of your mortgage loan and locked into a set interest rate. More information on Fixed Rate Mortgages