Fixed-Rate vs. Adjustable-Rate Mortgages with ABE
At ABE, we offer flexible mortgage options designed to meet you where you are—whether you’re buying your first home or planning for the long term. Understanding the differences between fixed-rate and adjustable-rate mortgages can help you choose the option that best fits your goals.
Fixed-Rate Mortgage
Benefits with ABE
Consistent monthly payments
Your interest rate stays the same for the life of the loan, providing stable principal and interest payments.
Protection from rising interest rates
Once your rate is locked, it will not increase—even if market rates rise.
Simplified budgeting
Predictable payments make it easier to plan and manage household finances over time.
Ideal for long-term homeownership
A strong option if you plan to stay in your home for many years.
Personalized lending experience
ABE provides local, member-focused service and guidance throughout the mortgage process.
ABE provides local, member-focused service and guidance throughout the mortgage process.
Adjustable-Rate Mortgage (ARM)
Benefits with ABE
Lower initial interest rate
ARMs typically begin with a lower rate than fixed-rate mortgages, which can result in lower initial monthly payments.
Potential short-term savings
If you plan to sell or refinance before the adjustable period begins, you may benefit from reduced interest costs.
Greater affordability upfront
Lower early payments may help increase your purchasing power.
Rate caps for added protection
ABE ARMs include limits on how much the interest rate can change, helping protect against dramatic increases.
Flexible option for changing plans
Well-suited for buyers who anticipate future changes such as relocation or refinancing.
Special Benefits for First-Time Homebuyers with ABE
Down payment assistance programs
Eligible first-time homebuyers may qualify for programs designed to help reduce upfront costs.
Closing cost assistance
Some programs may help offset closing costs, making homeownership more accessible.
Support from start to finish
ABE’s mortgage team works closely with first-time buyers to explain options, requirements, and available assistance.
Quick Comparison
| Feature | Fixed-Rate Mortgage | Adjustable-Rate Mortgage |
|---|---|---|
| Interest Rate |
Fixed for the life of the loan | Adjusts after initial period |
| Monthly Payment | Predictable | May increase or decrease |
| Initial Rate | Typically higher | Typically lower |
| Best For | Long-term homeowners | Short-term or flexible plans |
| Risk Level | Lower | Moderate |
Which Mortgage Is Right for You?
A fixed-rate mortgage may be a good fit if you prefer stability and consistent payments.
An adjustable-rate mortgage may be a better option if you plan to move or refinance within a few years.
First-time homebuyers are encouraged to explore available down payment and closing cost assistance programs, which may help make homeownership more affordable.
Ready to Get Started?
Contact ABE today to speak with a mortgage specialist and learn more about available home loan options or get started anytime with ABE’s secure online mortgage application.
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