A fixed-rate mortgage has an interest rate that stays the same throughout the loan term—typically 15, 20, or 30 years.
Predictable monthly payments
Protection from interest rate increases
Great for long-term homeowners
Higher initial interest rate
Less flexibility in falling-rate environments
An adjustable-rate mortgage features a lower initial interest rate, which adjusts after a fixed period—usually 5, 7, or 10 years. After that, the rate may change annually based on market conditions.
Lower initial monthly payments
Potential savings if rates stay low
Best for short-term buyers or refinancers
Payments may increase over time
Harder to budget long-term🔍 Keyword tip (used naturally): “what is an ARM loan,” “adjustable-rate mortgage explained”
| Feature | Fixed-Rate Mortgage | Adjustable-Rate Mortgage |
|---|---|---|
| Interest Rate | Constant | Starts low, then adjusts |
| Monthly Payments | Stable | May increase or decrease |
| Ideal For | Long-term buyers | Short-term owners or refinancers |
| Risk Level | Low | Moderate to high |
Ask yourself these questions to decide:
Less than 7 years? An ARM could save you money.
Long-term? A fixed-rate loan offers security.
If not, a fixed-rate loan may be safer.
If yes, locking in a fixed rate can protect you.
Choosing between a fixed-rate and adjustable-rate mortgage in 2025 depends on your financial goals, risk tolerance, and how long you plan to keep the home.
Need Expert Mortgage Advice?
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