If you have questions about this change, you're in the right place. Our editors, experts, and community of change optimists have answers!
fixed rate or adjustable rate?
is one better than the other in this economy?
Adjustable rate mortgages have a lower interest rate - but then you have to worry when the adjustable period (1 year, 3 years, whatever) is over, the interest rate will rise. You can certainly plan to refinance before the initial period is over - but there are always costs to refinancing, and you'll be guessing as to whether rates will rise.
As a rule of thumb: if you're almost positive you'll move in a couple of years, get a three or five year adjustable rate mortgage. If you're not sure when (or if) you'll move in the future, get a fixed rate mortgage - the interest rate difference (today) isn't that much, and you'll sleep better at night because you know your mortgage payments won't go up.