ARM vs. FixedRate Mortgage Calculator
There are two main types of mortgages; adjustablerate mortgages (ARMs) and fixedrate mortgages. Adjustablerate mortgages can provide attractive interest rates, but your monthly payment amount can vary throughout the entire term of the mortgage. Typically, an adjustablerate mortgage offers an interest rate that is lower than a fixedrate mortgage. Depending on how often the mortgage rate adjusts and in what direction (go up or go down), ARMs can cost a borrower more or less money in the long run compared to a fixedrate mortgage.
Loan information:Press spacebar to hide inputs 
Adjustments:

Closing Costs:Press spacebar to show inputs 
Total $4,800.00

Total Payments $447,272

Principal Balance by Yearpress spacebar to show graph 
Why use the ARM vs. FixedRate Mortgage Calculator?
The ARM vs. FixedRate Mortgage Calculator will compare the monthly mortgage payments for each type of loan. This calculator compares fixedrate mortgage payments to both fully amortizing adjustablerate mortgagesand interestonly adjustablerate mortgages. Knowing exactly how much you stand to gain or lose depending on the different aspects of your mortgage loan can form a crucial part of your decisionmaking process, and that is how the ARM vs FixedRate Mortgage Calculator can help you.
How to use The ARM vs. FixedRate Mortgage Calculator
Not sure where to start? Let us help you:
 Enter the amount you intend to borrow in the field marked Mortgage amount
 Use the dropdown to select your mortgage term
 Input your interest rate
 Click the [ ] icon to expand the Fully Amortizing ARM options
 Enter your initial interest rate
 Specify the number of months your loan will be fixed at this rate – in cases with no fixed initial period, this will be 0
 Enter the amount by which you expect your mortgage rate to increase, as a percentage
 Input the maximum you think the interest rate will reach
 Repeat steps 48 for the Interest only ARM section (optional)
 Click View Report
Who is this Calculator for?
This calculator is most useful if you:
 Are trying to decide between an ARM, a fixedrate mortgage, and an interestonly ARM
 Would like to weigh up the risks and benefits of getting an ARM as opposed to a fixedrate mortgage
 Want to compare the total amount of interest you are likely to pay between an ARM and a fixedrate mortgage.
Should I get an AdjustableRate Mortgage or a FixedRate Mortgage?
Since ARMs typically have lower interest rates, it is important to consider how long you will be in the home or how long you will have the mortgage. You also need to consider your ability to deal with possible adjustments in your monthly mortgage payment. If you have the financial flexibility to handle a potential increase in your monthly payments, then it may well be worthwhile taking the lower rate offered by an ARM. After all, if interest rates decrease, so will your monthly payment. Additionally, you are typically able to borrow more on an ARM than you can on a FixedRate Mortgage.
Fixedrate mortgages have an interest rate that stays the same for the entire term of the mortgage loan. This therefore means that the monthly mortgage payments are fixed for as long as you have the loan – unless you enter into an agreement with your lender where you can pay more or less under particular circumstances.
The main benefit of this is that you are protected against fluctuations in the interest rate. Therefore, you can plan several years in advance safe in the knowledge that your monthly payments (which is likely to be your biggest regular outgoing) will not change. However, if mortgage rates go down over time, a fixedrate loan will result in you paying more than you would have with an ARM.
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