What is the difference between an adjustable rate and a fixed rate loan? Adjustable rate loans (or ARMs) can be tempting because of the lower initial interest rate, but they come with some risks. It is very important to be educated on the interest rate environment, the local Charleston real estate market, and how ARMs work. You also need to be quite certain of how long you will own the home. Fixed rate home loans generally have a higher rate, but they provide more security with regards to your payment amount and interest rate. Fixed rate loans are seen much more in Charleston than they were back in early 2000.
Adjustable rate mortgages offer many attractive advantages. ARMs have lower rates and lower payments at the beginning of the loan term.
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