3 Times an Adjustable Rate Mortgage Makes Sense

More homebuyers are turning to adjustable-rate mortgage loans to keep their payments affordable. It’s easy to understand why. The average rate for a 5/1 adjustable-rate mortgage (ARM) is 5.51%, compared with 6.33% for a 30-year fixed-rate conventional loan, according to the Mortgage Bankers Association’s most recent Weekly Mortgage Applications Survey. On a $400,000 loan, that difference translates to about $210 in monthly savings with an ARM. ARMs begin with a fixed interest rate, followed by periodic ...