 TITLE: What’s the Difference Between Fixed-Rate and Adjustable-Rate Mortgages? CONTENT: How to Choose Between an Adjustable-Rate and Fixed-Rate Mortgage\n----------------------------------------------------------------\nHere are a few questions to ask yourself as you decide whether an adjustable-rate mortgage or fixed-rate mortgage makes the most sense for your home purchase.\n*   **How long do you plan on living in your home?** As mentioned, ARMs often work best for those who don't plan to stay in the home for more than a few years, since you'll get to spend some or all of the time paying the low introductory rate and avoiding the probable higher rate that will kick in later. If you plan to be in the home for the long term, a fixed-rate APR may be best since it will remain predictable.\n*   **What do current interest rates look like?** When mortgage rates are on the high side, getting locked in to a fixed-rate loan could be expensive (though you may be able to refinance later). In that case, the risk of an ARM could be worth it since the introductory rate will be lower than fixed-rate loans. On the other hand, if mortgage rates are currently low, it could be a great time to lock down a fixed-rate loan since future market changes won't impact you.\n*   **Will you be able to afford payments if interest rates rise?** The beauty of fixed-rate mortgages is the predictability of your monthly payments. If you're on a tight budget, this certainty can help you stay on track. While ARMs start off with a lower rate, they can rise later, which would increase your monthly payment. Consider how flexible your budget is (or isn't) and whether you'd be able to afford a higher mortgage payment if interest rates go up. END