ARM vs Fixed Rate Mortgage Calculator
Compare adjustable rate mortgage with fixed rate mortgage payments
About this calculator
This ARM vs Fixed Rate Mortgage Calculator helps you compare the costs and payment structures of adjustable-rate mortgages (ARMs) against fixed-rate mortgages. By analyzing different interest rate scenarios, payment schedules, and total costs over time, you can make an informed decision about which mortgage type best fits your financial situation. The calculator shows how ARM rates can change over time and compares total interest paid, monthly payments, and long-term affordability between both mortgage options.
How to use
Enter your loan amount, down payment, and loan term. Input the fixed rate for comparison, then enter the ARM's initial rate, adjustment period, and rate caps. The calculator will display side-by-side comparisons of monthly payments, total interest costs, and payment schedules for both mortgage types over your specified loan term.
Frequently asked questions
What's the main difference between ARM and fixed-rate mortgages?
Fixed-rate mortgages maintain the same interest rate throughout the loan term, while ARM rates can adjust periodically based on market conditions and preset terms.
When might an ARM be better than a fixed-rate mortgage?
ARMs often offer lower initial rates and may be beneficial if you plan to move or refinance before rates adjust significantly upward.
What are rate caps in ARM mortgages?
Rate caps limit how much your ARM interest rate can increase per adjustment period and over the entire loan lifetime, providing borrower protection against excessive rate increases.