Join my world of mortgage rates
Adjustable rate mortgages, on the other hand, have an interest rate that rises and falls usually with the prime rate. When interest rates are high, your mortgage payments increase; when interest rates are low, your mortgage payments decrease accordingly. Because this kind of mortgage is less risky for banks, they set the interest rates for adjustable rate mortgages slightly lower than they do for fixed rate mortgages. They also offer an introductory period, usually three to seven years, during which the interest rate on your home mortgage is locked at an attractively low rate. Which type of loan should you choose? Do not immediately be tempted by the lower interest rates of adjustable rate mortgages.