Fixed vs. Adjustable-Rate Mortgage: Which Is Right for You?

By Julio Cobian, Mortgage Advisor in Chico, CA

One of the biggest decisions you’ll make when choosing a home loan is whether to go with a fixed-rate mortgage or an adjustable-rate mortgage (ARM). Both options have their pros and cons, and the right choice depends on your goals. Here’s a breakdown to help you decide.

What Is a Fixed-Rate Mortgage?

A fixed-rate mortgage keeps the same interest rate for the entire life of the loan.

• Pros: Stability and predictable monthly payments.

• Cons: Rates may be slightly higher than initial ARM rates.

This option is popular with buyers who plan to stay in their home long-term.

What Is an Adjustable-Rate Mortgage (ARM)?

An ARM starts with a lower fixed rate for a set number of years (like 5, 7, or 10), then adjusts periodically based on market conditions.

• Pros: Lower initial payments.

• Cons: Future payments may increase when rates adjust.

This can be a smart choice for buyers who plan to sell or refinance before the adjustment period.

Which One Should You Choose?

• Fixed-rate mortgage: Best for stability and long-term homeownership.

• ARM: Best if you need lower initial payments or expect to move in a few years.

Final Thoughts

There’s no one-size-fits-all answer. As a mortgage advisor in Chico, CA, my role is to understand your goals and recommend the loan that makes the most sense for you.

📲 DM me today or call to talk through your loan options.