Fixed-Rate vs. Adjustable-Rate Mortgage Loans Along with other decisions you will find yourself making while shopping for a mortgage, you will be deciding whether to take a fixed-rate mortgage (FRM) or an adjustable rate mortgage (ARM). As the name implies, the interest-rate of an FRM will remain the... 

Adjustable-rate loans, also known as variable-rate loans, usually offer a lower initial interest rate than fixed-rate loans. The interest rate fluctuates over the life of the loan based on market conditions, but the loan agreement generally sets maximum and minimum rates. When interest rates rise, generally...